DCAA Compliance Blog

Your Source for DCAA News and Information for Contractors

ReliAscent® LLC is the only government contract accounting firm that specializes in all aspects of government contracting compliance.  From our DCAA compliant accounting services, to monthly government contract accounting for all government agency awards, contract management & administration, and financial services & planning, our goal is to ensure the success of our clients, and all small business government contractors and grantees.  

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Are ITAR regulations serious for small government contractors?

Posted by Mike Anderson on Mon, Jun 28, 2010 @ 03:03 PM

To the un-initiated, ITAR (International Traffic in Arms Regulations) as set forth by the Arms Export Control Act (22 U.S.C. 2278) may seem like just another government regulation that isn't always watched or enforced.  Nothing could be further from the truth.  ITAR regulations are designed to keep America's technology advances, especially those that give our national defenses an edge, at home and out of enemy hands.  The regulations are worded such that they control the "export" of this technology.  The regulations also mean that "export" could involve something as seemingly simple as a foreign visitor seeing something that is controlled, even though this happens in an American facility on American soil.  It also could mean a "Canadian" citizen (for example) seeing or hearing something in an American office that is controlled by the ITAR restrictions.  Does this mean that you might un-knowingly violate an ITAR restriction if you have a foreign visitor in your plant?  That shouldn't happen.  All technology that is ITAR controlled should be appropriately marked.  If you are in the business of developing new technology, then it is your responsibility to know when you may have technology that would be controlled by ITAR and take measures to both mark it as such and control it.  Controls would include protecting it from being seen by foreign visitors as well as other export control measures.  Recently there was a good example of the seriousness of the ITAR restrictions as you probably saw on our "Industry Update" page on this website.  This local company exported some of their products, that turned out were controlled by the Munitions List, and is now facing penalties including paying a $1 Million fine and 5 years on probation.  The company is have serious trouble and has filed for Chapter 11 Bankruptcy in part due to the violation of the ITAR regulations.  It is always better to enlist help in researching ITAR issues or reviewing the Munitions list rather than charging ahead and hoping that "it's probably no big deal".

Topics: Ethics, ITAR, Munitions List