A brief introduction into export control law

When working in international commerical law, sooner or later you will come into contact with so-called export control law. But what is this exactly? This article will illuminate the topic while putting the focus on German export control law.

Export control means, above all, that the supply of goods, technology or software/data processing programs (these three are grouped under the umbrella term “goods”) to other countries may be subject to public authorization. In addition to any authorization requirements, a delivery of goods may also be prohibited in special cases, e.g. if the “delivery” is to a country against which an embargo has been imposed.

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Now whether an authorization is required depends on four factors:

– what you want to deliver (1)

– which country you want to deliver to (2)

– who is to be supplied (3)

– for what purpose the goods are to be used (4).

Finally, in the case of embargoes, the conclusion of the contract may already be subject to approval. In Germany, the authority carrying out the control is BAFA (Federal Office of Economics and Export Control).

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So, why are there export controls? In foreign trade, in fact, the principle of the free movement of goods the principle of the free movement of goods applies at both national and European level. However, restrictions and orders of duties to act are possible if this is necessary to safeguard certain higher-ranking protected interests. The central objective is to prevent Germany or its allies from being threatened by conventional weapons and weapons of mass destruction. German exports in crisis regions should also neither reinforce conflicts nor contribute to internal repression or other serious human rights violations. Its involvement in international bodies also obliges the Federal Republic of Germany not to burden foreign relations with critical exports. Last but not least, export controls serve to enforce embargo resolutions of the United Nations Security Council and implement EU embargo regulations.

Which norms are now specifically examined? Approval requirements may arise in particular from the Foreign Trade and Payments Act (AWG) and the Foreign Trade and Payments Ordinance (AWV), Regulation (EU) 2021/821 (EU Dual-Use Regulation), Regulation (EU) No. 258/2012 (Firearms Regulation), Regulation (EU) 2019/125 (Anti-Torture Regulation) and various embargo regulations.

In practice, companies are required to first do an own examination. If this leads to the conclusion that the specific export project is subject to authorization, a formal application for an export/transfer license must be submitted to BAFA. Within the process, one should be aware of which documents and information will be required to process your application in advance of submitting it. The more complete your information is, the more likely you are to avoid time-consuming queries. In particular, BAFA should be provided with information on the person responsible for the export, end-use documents, technical documentation and information on the buyer, consignee as well as end-user.

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Finally, with regard to legal consequences: If export control law is violated, not only can an application be denied. In addition, foreign trade regulations also provide for criminal and administrative penalties.

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