Export Controls Pose Renewed Challenge to American Exporters Post-9/11

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Export Controls Pose Renewed Challenge to American Exporters Post-9/11
    WASHINGTON, Sept. 10 -- The end of the Cold War began a decade of
relaxation of the US Government's enforcement of export controls aimed at
sensitive and dual-use technologies.  Often people are surprised to learn that
these export restrictions largely remain in place, and since the September
11th terrorist attacks, investigation efforts have been strengthened and
penalties increased.
    Today, most US companies with operations and/or markets overseas may be
running afoul of these restrictions, unaware that they are out of compliance
and exposed to substantial fines and other penalties.  The explosion in
cross-border corporate data and communications networks creates many possible
violations not even contemplated when the export controls were adopted.
    In a recent article in the Houston Journal of International Law
(link attached below), Christopher F. Corr, a partner in the international
trade practice at White & Case LLP, discusses the current state of US
export-control law.  Corr's article points out that this is not simply about
the sale of sensitive technologies to rogue regimes or terrorist
organizations.  It is multifaceted, and may affect companies in a variety of
surprising ways, for example:

     *    US companies that legally employ immigrants who perform certain
          technological functions or have access to certain data may be
          engaged in technology export as defined by the rules.
     *    Multinationals with global information and data networks that can be
          accessed by employees around the world may also be deemed to be
          exporting controlled technology.
     *    Companies involved in cross-border M&A, or expanding or investing in
          foreign business, need to be duly diligent regarding the
          export-control issues that may affect their acquisition or
          investment.

    The stakes are high -- particularly so since US courts have held that
successor liability for improper export of a controlled technology may apply,
exposing companies to penalties for violations prior to ownership.  Corr
recommends that exporters undertake an assessment and, if needed, a compliance
program.

     http://www.whitecase.com/article_wall_still_stands_corr_spring_2003.pdf

    To talk to Chris Corr and find out more about export controls in the
post-9/11 era, please contact Sandi Sonnenfeld, White & Case, 212/819-8299,
ssonnenfeld@whitecase.com.
SOURCE White & Case LLP