Updated Version

Presentation of DSP-61 and DSP-73 Licenses For CBP Decrementation No Longer Required

By Odyssey E. Gray, III, Associate, FD Associates, Inc.

Pursuant to a Final Rule issued in the Federal Register (Public Notice 9811, 82 FR 15 January 3 2017), with an effective date of December 31, 2016, exporters are no longer required to present their DSP-61 Temporary Import and DSP-73 Temporary Export licenses with Customs and Border Protection (“CBP”), prior to export, or import, to facilitate the physical decrementation of the licenses for the hardware that is the subject of the authorization.  The decrementation is now electronic in the Automated Commercial Environment (ACE), in the same manner as when exports of hardware are made under authority of a DSP-5 Permanent Export license. 

This action supports an Executive Order and the SAFE Port Act which called for electronic submission of data by businesses to import or export cargo.  This rule was actioned by the Directorate of Defense Trade Controls (“DDTC”) amending the ITAR pursuant to implementation by CBP of the International Trade Data System (“ITDS”).  This system permits exporters and importers to electronically submit the data referenced above.

DSP-61 and DSP-73

Exporters require, from time to time, the ability to temporarily import or temporarily export ITAR-controlled or ITAR regulated hardware into and from the United States for several types of business activities.  The DSP-61 and DSP-73 are the licensing vehicles used by DDTC to authorize these activities.

Temporary imports may be required, for example, to allow a business to conduct activities such as product demonstrations to potential customers, to participate in trade shows or to provide a manufacturing process to a foreign produced defense article.  The DSP-61 is the licensing vehicle to facilitate this.

Temporary exports may be required for many of the same reasons – marketing, trade shows or temporary use abroad to support a particular activity.  The DSP-73 is the licensing vehicle used for this purpose.


As part of its national security responsibility, DDTC must oversee the transfer of ITAR controlled or ITAR regulated commodities to ensure that U.S. controlled technology and hardware is not provided to unauthorized parties or entities.  DDTC’s licensing system is critical to the success of this objective.

Previously, when a temporary export or import was made against either an approved DSP-73 (export) or DSP-61 (import), exporters had to physically present their respective authorization to CBP so that the license could be pen and ink “decremented.”  This decrementation (marking the license, e.g., date, description, initial of the CBP personnel) was CBP’s physical verification that what was authorized to ship was being exported or imported.  CBP would decrement (verify) the temporary export or import license for the item(s) listed on the license when transiting a specific port.

While this manner of decrementation was effective in accomplishing the goals of DDTC in tracking the transit of ITAR controlled or ITAR regulated hardware in and out of the United States, it put an enormous burden on exporters and CBP in terms of managing the logistics of the movement of the actual hardware, as well as, coordinating delivery of the paper license for decrementation.  Copies of the original license were not acceptable for decrementation purposes, and, thus, non-compliant with the ITAR.  A lack of pre-coordination with a freight forwarder at port of entry or departure could lead to enormous difficulties, and, on occasion, administrative violations of the ITAR.

Electronic Submission is the Solution

The final rule incorporates the use of the Automated Export System in ACE for exports against DSP-61s and DSP-73s to electronically decrement the DSP-61 or DSP-73, while using the import portal within ACE for imports against DSP-61s and DSP-73s.  As a result, the DSP-61s and DSP-73s are now automatically decremented by ACE import entries and AES Electronic Export Information (EEI) submissions in ACE.

With the elimination of the need to present DSP-61 and DSP-73 licenses for decrementation, consistent with the goals of the referenced legislation, exporters will likely manage more efficient operations in connection with their temporary export and temporary import licensing requirements.

Exporters’ recordkeeping requirements remain intact, and, in fact, the weight of those responsibilities may have increased a notch or two as expectations for complete import records is added to the export records generated from AES in ACE.  As an example of the more stringent requirements, exporters must ensure that complete PGA Message Set information is included as part of their electronic filing for imports.  The PGA Message Set includes information such as License / Exemption type, the DDTC Registration number, and the Anticipated Arrival Date.  You will need to ask your freight forwarder not only for your complete AES record for exports, but also the ACE filing for imports including screen shots of the actual PGA Message Set information. 

The upside is exporters no longer have to be concerned with returning original licenses appropriately decremented to DDTC per ITAR 123.22, just like the DSP-5.  Nor do they need to worry about a shipment departing over the weekend not properly clearing CBP.

DDTC’s duties to track ITAR-controlled hardware has not lessened nor has the exporters duty to exert due diligence in connection with their export practices.  Changes such as these, however, may result in better controls and management of controlled commodities being temporarily imported and exported.

Post Script Update

As astute reader pointed out that transactions involving the use of a carnet document (duty relief for certain countries including the U.S. when hardware is for demonstration/marketing purposes) is not eligible for this procedure and the temporary licenses must still be presented to CBP for endorsement at time of import into the United States and export from the United States.

Additionally, readers should be aware that although the ITAR was amended to not require the presentation of the DSP-73 or DSP-61, not all ports are following the new requirements, thus while you can tell the CBP presentation for pen and ink decrementation is not required, you should remain prepared to present the license if requested by CBP. 

Should You Be The ITAR Empowered Official???


Jenny Hahn, President


Your company manufactures defense articles and has been told that in order to conduct any international business such as marketing the defense articles or actually making a sale and selling hardware, software or services, you must first be registered with the Department of State as a precursor to applying for any ITAR export license. Then you learn that the company must have someone sign the ITAR license application and that person is called the “ITAR Empowered Official”.

Sounds simple and administrative. Anyone in the company should be able to fulfill this function, right?

Actually, who the company designates as the ITAR Empowered Official is a very important first step in the company trade compliance program. The ITAR Empowered Official is responsible to meet the conditions set forth in the ITAR for this position and in many small companies the ITAR Empowered Official is also responsible for the company trade compliance program.

If you have been “selected” or “volunteered” for the role of ITAR Empowered Official, it is important to first know what the ITAR states your qualifications should be. The Department of State often asks about the qualifications of the persons in your company designated as the trade compliance personnel including the ITAR Empowered Official. Selection is key.

Lets review the ITAR regulation at ITAR 120.25:

   § 120.25 Empowered Official

(a)  Empowered Official means a U.S. person who: 

(1) Is directly employed by the applicant or a subsidiary in a position having authority for policy or management within the applicant organization; and 

(2) Is legally empowered in writing by the applicant to sign license applications or other requests for approval on behalf of the applicant; and 

(3) Understands the provisions and requirements of the various export control statutes and regulations, and the criminal liability, civil liability and administrative penalties for violating the Arms Export Control Act and the International Traffic in Arms Regulations; and 

(4) Has the independent authority to: 

(i) Inquire into any aspect of a proposed export, temporary import, or brokering activity by the applicant;

(ii) Verify the legality of the transaction and the accuracy of the information to be submitted; and 

(iii) Refuse to sign any license application or other request for approval without prejudice or other adverse recourse. 

Lets analyze each element of the requirements.

U.S. Person – The ITAR defines “Person” as a natural person or a corporation, business association, partnership, society, trust, or any other entity, organization or group, including governmental entities. A U.S. person meets the “Person” definition, and is a citizen of the United States, a lawful permanent resident a.k.a. green card holder or a person here in the US on a protected status (religious or political asylum).

Directly employed by the applicant or a subsidiary – other than stating the obvious, this means that external resources such as your outside counsel, consultant, or past ITAR Empowered official who retires and consults back to the company part time on a 1099, cannot fulfill this role.

In a position having authority for policy or management within the applicant organization - Typically Directors, Managers, Vice Presidents and Presidents are some of the titles associated with the person fulfilling this role. If your title is contracts administrator, shipping clerk, administrative assistant, it suggests that the role you play in the company does not carry the level of responsibility or authority for policy or management to meet the threshold to be designated as the ITAR Empowered Official.

Is legally empowered in writing by the applicant to sign license applications or other requests for approval on behalf of the applicant - A letter is required from the Key Senior Officer (the person who signed the registration statement with the Department of State) to you designating you formally as the company ITAR empowered official. If you are at a subsidiary location, the letter should specify that you are limited to signing authority for your location only. Corporate empowerment letters can simply restate the ITAR definition at §120.25 or they can be more expansive articulating the responsibilities of the ITAR Empowered Official for the company trade compliance program or responsibilities that person may also hold. Each ITAR Empowered Official should maintain this letter in their files, Human Resources should also maintain it in the personnel file and the corporate books should maintain a copy.   

Understands the provisions and requirements of the various export control statutes and regulations-

This means the ITAR Empowered Official should be able to do more than spell ITAR! It is expected that you will have had training in the International Traffic In Arms Regulations so that you can assert that you understand the regulations. But that is not enough. The ITAR references various export control statutes and regulations. Related regulations include the Foreign Trade Regulations, which every ITAR hardware export transaction interfaces with; the Office of Foreign Assets Controls, which maintains a list of persons and companies and countries that require separate approvals to make exports to from what the ITAR or EAR may impose; the Foreign Corrupt Practices Act, that prohibits the making of payments or other gifts to influence a sale to a government (bribe); and the Export Administration Regulations that regulates the items that were once ITAR but moved over the last few years as a result of Export Control Reform, along with truly commercial or dual use items. That’s a lot of regulations you should be familiar with!

And the criminal liability, civil liability and administrative penalties for violating the Arms Export Control Act and the International Traffic in Arms Regulations- It is critically important that as the ITAR Empowered Official, you know what the fines and penalties are for willful a.k.a. criminal violations and those unwitting inadvertent mistakes made by the company. The ITAR Empowered Official and the company should understand what the possible outcomes could be for the company and responsible individuals in terms of jail time, denial of export privileges and fines as well as understanding the overall financial costs the company could have as a result of export violations not to mention the potential to lead to repercussions in government contracts including suspension or debarment. 

Regular training of the ITAR Empowered Official to understand the civil and criminal penalties is necessary. Penalties are updated on a periodic basis and adjusted for inflation.

Has the independent authority to:

  1. Inquire into any aspect of a proposed export, temporary import, or brokering activity by the applicant -The ITAR Empowered Official should be able to question any functional department personnel about the transaction, including business development, finance, contracts, sales, legal, shipping.
  2. Verify the legality of the transaction and the accuracy of the information to be submitted- The tools and resources should be readily available to the Empowered Official to conduct due diligence and confirm the proposed transaction is a legitimate business dealing with qualified eligible parties. 
  3. Refuse to sign any license application or other request for approval without prejudice or other adverse recourse – This means the boss can’t fire the ITAR Empowered Official if the ITAR Empowered Official says I am not comfortable with proceeding based on what I know about this transaction.

Based on the criteria enumerated in the ITAR to fulfill this role, the ITAR Empowered Official should be a person within the company that has knowledge about the regulations, understand the scope of the regulations, the penalties if not abided by, the respect of company employees to follow the ITAR Empowered Official lead and understanding and buy-in by management that no one can override any unfavorable decision made by the ITAR Empowered Official concerning a pending export transaction.

This role is often entered into by employees who are volunteered for the position because they are available or because they heard about the ITAR on their last job. The requirements to fulfill the ITAR Empowered Official position is much more demanding and carries with it significant expectations by the Department of State regarding this responsibility and how the company ensures that it selects qualified candidates. The company is expected to ensure that the ITAR Empowered Official receive regular training regarding the export regulations and criminal and civil penalties.

If you read this article and questioned your qualifications, or thought you might need more training, join us for our ITAR Empowered Official classes in April and November!  We discuss in detail the compliance roles ITAR Empowered Officials take on..  




As you may be aware the Trump administration levied a restriction on electronics to be carried on board from certain airports in the following cities and countries in the Middle East:


Cairo, Egypt;

Istanbul, Turkey

Kuwait City, Kuwait

Doha, Qatar

Casablanca, Morocco

Amman, Jordan

Riyadh and Jeddah, Saudi Arabia;

Dubai, United Arab Emirates

Abu Dhabi


Travelers may also experience issues in the above listed airports when in transit, if required to clear customs in that country.

FD Associates has learned of a situation that occurred recently where in transit U.S. Travelers at the Abu Dhabi airport clearing U.A.E. Customs were required to forfeit all electronics when travelling to the United States. This includes laptops, ipads, tablets, cell phones, and batteries from e-cigarettes. It is not clear if this action of forfeiture was in connection with the U.S. Restriction on electronic carry on items on flights bound to the United States from the above countries.

As exporters might travel with electronics that store ITAR or EAR controlled data on them, although both sets of export regulations provide exemptions for travelers and their personal use of such data, there is no exemption for the forfeiture of your electronic device to a foreign government. The forfeiture is an export.

Should you be required to forfeit your electronics with export controlled or government data on your devices, you have an obligation to notify DOS, BIS and/or DOD of any controlled or government owned data or hardware forfeited. It is our understanding that DOD has recommended persons subject to forfeiture of government owned or issued electronics destroy the electronics before forfeiting.

Travel routes should be carefully planned for future travel and arrangements to store your electronic devices with shipped luggage is recommended if your travel includes any of these destinations assuming that the forfeiture only applies to carryon items and not checked luggage as well. We recommend all travelers with U.S. Government issued electronics verify with their customer the protocol to be used if encountering such a situation.




Paul Croarkin, Senior Associate

Keil Ritterpusch, Senior Compliance Associate


On January 10, 2017, the Department of State and the Department of Commerce published final rules to further refine the control of spacecraft and related items controlled for export by the International Traffic in Arms Regulations (“ITAR”) and the Export Administration Regulations (“EAR”).  The final rules are part of the continuing revision of the ITAR through the Export Control Reform (“ECR”) initiative.  For copies of the Federal Register Notices publishing the final rules, please see http://pmddtc.state.gov/FR/2017/82FR2889.pdf and https://www.bis.doc.gov/index.php/documents/regulations-docs/federal-register-notices/federal-register-2017/1630-82-fr-2875/file.

The revision of the ITAR’s United States Munitions List Category XV and the EAR’s Export Control Classification Number 9X515 went into effect on January 15, 2017.  Unlike prior ECR revisions of the ITAR, this latest revision had a very short interval from final rule to effective date because the changes involved had already been published through Notice and Comment rulemaking and had received favorable comments from the public.

The revised rules include the following notable changes requested by the commercial space industry and advocated by the Department of Commerce, including:

  • Moved certain remote sensing satellites from control by ITAR to control by the EAR:

  • spacecraft with an aperture of equal or less than 0.5 m are now controlled by the EAR under ECCN 9A515.a.1
  • spacecraft with remote sensing capabilities beyond NIR (i.e., SWIR, MWIR, and LWIR) that are not otherwise enumerated on the ITAR’s United States Munitions List (“USML”) are now controlled by the EAR under ECCN 9A515.a.2, 
  • spacecraft with radar remote sensing capabilities (e.g., EASA, SAR, and ISAR) having a center frequency equal to or greater than 1 GHz but less than 10 GhZ and having a bandwidth between 100 MHz and 300 MHz are now controlled by the EAR under ECCN 9A515.a.3

  • Specifically, for the export of spacecraft and components for the aircraft in ECCNs 9A515.a.1 through a.4, the prospective exporter must submit a request to the Department of Commerce pursuant to Section 740.20(g) of the EAR for export of these more sensitive spacecraft and related components per the License Exception STA.  
  •  In parallel with the movement of these spacecraft and components to control by the EAR, the Department of Commerce created a new mechanism to approve the export of these spacecraft and components without an export license pursuant to a revision to the EAR’s Strategic Trade Authorization (“STA”) License Exception set forth in Section 740.20 of the EAR
  •  Moved components of the spacecraft in ECCNs 9A515.a.1 through a.4 to control on the EAR under ECCN 9A515.g
  • Moved spacecraft providing space based logistics, assembly, or servicing of other “spacecraft” that are not enumerated on the USML to the EAR under ECCN 9A515.a.4.

  • Clarified that the USML does not control spacecraft automatically because the spacecraft supports human habitation.  Only spacecraft with the characteristics expressly enumerated in USML Category XV are ITAR-controlled.

  • Redefined several controls based on technical capabilities rather than end use of the spacecraft.  For example, the final rule provides that spacecraft that perform real-time autonomous detection and tracking of moving objects, other than celestial bodies, are ITAR-controlled, but that this control does not apply to systems that can track fixed points to determine their own movement based on the relative position of the fixed points over time.

  • Removed and replaced confusing criteria concerning integrated propulsion and attitude control, providing specific technical parameters for the types of spacecraft propulsion systems and attitude control apparatus that make a spacecraft ITAR-controlled. 
    • Along these lines, the James Webb Space Telescope (“JWST”) was removed from the ITAR for control under 9A004.u, the same ECCN that governs exports of the International Space Station. 
    • Despite having thrusters for attitude control and movement, unlike satellites, the Department of State ruled that the JWST and other scientific spacecraft that are able to alter their position in orbit should not automatically be controlled for export under the ITAR, and should be controlled under the EAR.
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