Why You Need An ITAR Consultant?
International trade is a critical element for many businesses to grow or sustain revenue streams. As such, companies involved in international business are required to comply with various U.S. export control regulations. The International Traffic In Arms Regulations (ITAR) is the strictest set of U.S. export regulations pertaining to the export of military and intelligence equipment, technical data, software and services.
For small companies, ITAR licensing and compliance can be challenging and the ITAR, written in 1976, is continually evolving in response to world events and U.S. national security objectives.
Choosing the right ITAR consultant will result in your company receiving guidance in the ITAR in plain English, consistent with the Department of State expectations and guidance and assistance that ensures the export licensing you need to conduct your international activities is prepared accurately and allows for your international business to be completed on time.
Choosing the right ITAR consultant will ensure that you have an understanding of the Department of State compliance expectations for managing ITAR controlled technical data at your company and the management of your company activities domestically that might expose your company to exports.
ITAR consulting goes beyond simply telling you about the ITAR, and the right ITAR consultant is a partner to your business delivering practical advice regarding the ITAR and the latest updates to it.
How Your Business Benefits From An ITAR Consultant
Managing ITAR at your company can feel overwhelming. The Department of State expects written policies, procedures, licensing, training, auditing for all ITAR registered companies. Managing ITAR at your company affects every functional department.
ITAR consulting has to take into consideration each functional department's responsibilities as applicable to the ITAR, along with other U.S. government regulations that are associated with making exports. ITAR consultants must stay on top of the latest changes to the ITAR, and think about how these changes might impact your company, processes, and procedures. Additionally, ITAR consultants apply the benefit of their experiences learned through working with other clients to convey best practices and lessons learned. Look to your ITAR consultant to provide ITAR services:
- ITAR Registration: The ITAR requires companies who manufacture defense articles, or export technical data and perform defense services, or broker defense articles or services to register with the Department of State and to establish a compliance program. Prime contractors and the DFARS mandate compliance to U.S. export laws in domestic contracts that include ITAR registration. Our ITAR consultants can prepare or review your ITAR registration ensuring it will process quickly with the Department of State. Our ITAR consultants are skilled at working with companies registering for the first time, updating the registration because of changes at the company, and supporting companies navigating the complex notifications associated with Merger & Acquisition activities.
- ITAR Licensing: Preparation of Department of State licenses in the Department of State portal DECCS or review of your draft licenses. Our ITAR consultants are experts in assisting client companies by preparing the required export licenses that allow our client companies to export technical data to market their ITAR defense articles internationally, to make sales of their products, and provide services to customers in a timely manner.
- ITAR Compliance Programs, Plans, and Procedures: The Department of State expects all registered companies to have a documented compliance program to ensure compliance to the ITAR. It is actually a question on the ITAR registration. ITAR compliance programs differ from client to client. Our ITAR consultants have decades of experience with developing ITAR manuals, plans, procedures for clients. Why struggle to create a program, when you can use an ITAR consultant with decades of experience who can jump start your ITAR compliance program and ensure the elements the Department of State expects are contained within.
- ITAR Training: Training is a critical element of all ITAR compliance programs. From new hires to the functional departments and annual training, training is often found to be an area of deficiency when investigating a matter of non-compliance. Our ITAR consultants offer the development of training programs to fit your needs including PowerPoint presentations for use in learning management systems, in-person ITAR training, and webinars customized for your company. We also offer general training courses. The aim of the training is to allow company personnel to understand how the ITAR affects their job specifically and the company and regulatory expectations for compliance. Effective training will help employees understand how the ITAR applies to various activities that constitute exports of ITAR goods, technical data, and defense services.
- Voluntary Disclosures: No one is perfect! Small and large companies alike, experience violations of the ITAR. The ITAR describes the voluntary disclosure process and allows for companies to notify the Department of State of these violations so that they can identify whether the violation is administrative, or one that has caused a foreign policy violation or national security concern. Our ITAR consultants can assist with the investigation, help your company write the voluntary disclosure, and develop and implement corrective actions that will demonstrate to the Department of State that you have implemented processes to ensure that these types of mistakes will not occur again.
- ITAR Audits: The Department of State expects registered companies to self-audit on an annual basis various aspects of their ITAR programs. An ITAR consultant leverages their expertise when auditing your company's processes and procedures. They bring to bear experience from auditing other clients, writing voluntary disclosures and best practices learned from attending industry conferences.
How to Choose An ITAR Consultant
Once you understand the benefits of using an ITAR consultant and what they can offer your business, selecting the right ITAR consultant is a critical next step.
When evaluating ITAR consultants there are many important factors to consider. Below are some questions that you can ask that will help your company make good business decisions that are not simply based on cost alone. Expertise, relationship with the U.S. Government agencies, knowledge and skill in the ITAR, Export Administration Regulations (EAR), Office of Foreign Assets Controls (OFAC), Foreign Trade Regulations (FTR), Foreign Corrupt Practices Act (FCPA), Bureau of Alcohol, Tobacco and Firearms (BATF) are valuable skillsets necessary for the right ITAR consultant to partner with your company.
These questions will help you identify the real deal and hopefully help you weed out the “experts” who are nothing but.
9 Questions To Help You Choose An ITAR Consultant
1. What’s Your ITAR Consulting Experience?
First, you need to know what your looking for. Are you seeking an ITAR consultant to provide licensing support to your company? Then ask them how many licenses they have crafted and what is their Return Without Action (RWA) rate. Ask them what commodity types they have experience in.
If the consultant has Department of State experience, they may be skilled at reviewing licenses but slow to craft them. That costs you. If the consultant comes from a corporate position where ITAR and ITAR licensing was not their full time responsibility, they might have limited experience with writing ITAR licenses and that experience might not be relevant to your commodity type. The ITAR consultant might not be aware of the nuances of licensing your commodity with the Department of State or Department of Defense. That costs you. .
If your looking for a ITAR consultant to assist with the development of company processes, procedures and compliance program. What questions do you ask? How many compliance programs have they crafted or updated? How many audits have they conducted? What type of audits were they? How many custom training programs have they provided?
It’s important to know that an ITAR consultant needs to have several years if not decades of experience and knowledge across several commodity types and industries in order to be effective to assist your company. ITAR consulting is a highly technical field and the ITAR consultant that you select needs to have expertise in your products and a good understanding of your company, company products, and all relevant U.S. trade regulations that will apply to your international business activities and structure of your company.
2. Test Their Knowledge With A Specific ITAR Question
The ITAR consultant your select, needs to understand more than the ITAR to properly guide your company in compliance with the U.S. export regulations. You should expect your ITAR consultant to explain your company obligations in an easy-to-understand manner. Describe your company requirements for a specific transaction and listen closely to the answer. If they say, the regulations are complicated, it depends on who, what, where, why and the export classification, that is a great start! AND if they also say ”if its ITAR, a license is likely required in most situations” and then they ask if you are registered with the Department of State, you have a good candidate! Keep talking..
3. Ask If The ITAR Consultant Can Get Your Company Certified
A lot of companies believe that becoming registered with the Department of State makes them ITAR Certified. ITAR Certified is industry terminology that is widely misunderstood for what it actually is. Prime contractors ask their supply chain partners to sign a form certifying they are registered with the Department of State and have a compliance program. Doing this doesn’t mean a company is ITAR Certified. Registration alone, or having an ITAR compliance program doesn’t make a company ITAR Certified, and there is no sanctioned ITAR Certification process.
Ask the prospective ITAR consultant if they can make your company “ITAR certified”? If they say “Yes absolutely!” Move on..
But if they say, there is no such thing, but there is an expectation for your company to have an ITAR compliance program, registration with the Department of State, licensing, training, auditing and voluntary disclosures, and we can help you with these requirements based on our experience. This is the ITAR consultant that you should consider.
Go to our consultants corner to read our article: ITAR Certified, What Does It Mean? – FD Associates
4. Is The ITAR Consultant Up To Date On The Latest Regulation Changes?
Ask the ITAR Consultant what tools they use to stay current on the regulations? If they tell you “The regulations haven’t changed recently” it means they are not connected.
If they tell you that they receive daily updates, check government agency websites and attend public meetings or seminars where the government presents and if they publish a monthly newsletter about regulatory changes, keep talking.
Go to our regulatory updates for the most current newsletter. SEPTEMBER 2021 UPDATE – FD Associates, Inc.
5. Is The ITAR Consultant An Optimist Or Realist?
What does the ITAR consultant tell you about the timelines for processing Department of State licenses? If they tell you that an application will take just a few weeks, they are not accounting for world events, regional conflicts and USG review policies. DOS license minimum processing is typically 8-12 weeks. Walk away from this consultant.
Ask the ITAR consultant if they can expedite your license application with the government. If they say yes, all the time… be cautious. The Department of State position on expediting is narrow and any request should be one that benefits the USG. A realistic ITAR consultant will tell you it’s difficult and not something done all the time. ITAR consultants with good connections with the Department of State and Department of Defense will occasionally be able to make calls on their clients behalf and they should know the strategies that will be helpful to moving your case forward.
Understanding whether your companies proposed export is going to receive an approval and the timelines for both ITAR license preparation and ITAR licensing processing and the underlying documentary requirements for your proposed export activity allows your company to plan properly starting right at the quotation stage. Relying on your ITAR consultant to guide you and to know that that that not all applications are equal, is a critical expertise for your ITAR consultant.
6. Has The ITAR Consultant Helped Companies Through The Voluntary Disclosure Process?
How many ITAR Voluntary Disclosures has the ITAR Consultant been involved with? What types of ITAR violations have they helped companies disclose to the Department of State? In what situations would they need to support an ITAR company with making dual agency disclosures? (Export of ITAR hardware typically will require a disclosure to Department of State and the Census Bureau). Do they know the automatic disclosure process requirement for ITAR 126.1 (sanctioned country) violations?
While your ITAR Consultant can guide your company in process, procedure, implementation, training and licensing to ensure compliance, we are all human and mistakes happen. When they do, you want to work with a company that has a deep history of writing voluntary disclosures and auditing experience such that they can apply this expertise to resolve the matters of non-compliance with best practices and process improvement. The ITAR consultant can help you with the investigation, preparation of the voluntary disclosure, filing with the appropriate agencies and corrective actions to minimize the potential of a civil fine by the US government agencies.
If you ask a potential ITAR consultant if they have prepared a Voluntary Disclosure and they answer “No”, you should move on.
7. Ask For Referrals- All ITAR Consultants Should Be Able to Provide References
Ask for three client references where the ITAR consultant has provided similar services to that you are looking for.
ITAR consulting is highly skilled area of expertise, where both lawyers and consultants with the requisite background provide services. Some organizations, including those offered by freight forwarders, are focused on the licensing and shipping aspects while others focus mostly on compliance activities such as audits. Look for an ITAR consultant that is well rounded and can provide a broad range of services when you need them.
References are evidence of the service offerings and skillset the prospective ITAR consultant has. Be sure to ask the references about their experience with delivery of work product and whether the ITAR consultant performed to the client references expectations. Failure to respond to clients requests quickly can indicate an overworked ITAR consultant.
8. Is The ITAR Consultant Trying To Upsell You?
What your company may need is dependent on the size of your company and the amount of exports you company makes annually. One size does not fit all. Small companies must have a scaled version of an export compliance program compared to that required of a prime contractor or first tier sub.
When you ask, what do I need to be ITAR compliant, is the consultant trying to push a software program that does the “thinking” for you?
There are ITAR software programs that can perform export jurisdiction and classification analysis and automate recordkeeping for export activities. Any software program is only as good as the data input by company personnel. They are a great supplement to a company trade compliance program but not a substitute for the expertise an ITAR consultant can offer.
Your ITAR consultant will provide clear instructions that must be accomplished to deliver ITAR compliance including procedures that facilitate post license shipments for license approvals and instructions on how to make the exports consistent with the licenses and the ITAR. Each consultation should describe all the necessary steps to get you to your objective without forcing the purchase of tools including software that you might not want or need.
9. Does The ITAR Consultant Have Real-World Experience?
Ask what qualifications the ITAR consultant has that makes their services the right fit for your business. Have they conducted audits of a manufacturing facility, a contract manufacturer, a service provider? Have they trained engineers, worked with clients that have foreign national employees, or perform research activities? Have they guided clients through the shipment process with U.S. customs?
ITAR consultants build their experience from years in the business assisting various companies with a wide range of technologies. What they learn over the years of business supporting their client base translates into an ability to quickly answer your questions based on their past experience, and from working with the Department of State on a daily basis on behalf of clients and their in depth knowledge of all elements of the ITAR.
This is why the best ITAR consulting firms are those that have a diverse client base, apply for hundreds of licenses each year for their clients, develop compliance processes and procedures, provide training in the ITAR, and assist their clients when matters of non-compliance are identified.
Select an ITAR consultant that can leverage their experience to give your company tools to help your company prevent export violations.