AEROSPACE -- -- Dealing with Regulatory Complexity

on Monday, 27 May 2013. Posted in Aerospace

Aerospace companies have been under particular regulatory uncertainty and pressure in the past few years.

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Historically, Aerospace companies have experienced regulatory uncertainty and licensing delays stemminfrom an overly complex export control system. A number of companies have also faced demands for "ITAR-free" products where U.S. made parts and components are designed out in the design plan. 

Small and Medium-sized Enterprises, SMEs were often the victim of this effort to avoid the reach of U.S. munitions controls, but the ongoing Export Control Reform initiative should make them the beneficiaries of the decontrol or the transfer of thousands of parts and components frothe State Department's Munitions List to the Commerce Department's Commerce Control List.  SMEs frequently don't have fully developed compliance programs, including the in-house compliance expertise of the larger companies and as a result they have sometimes held bacfrom aggressively pursuing export opportunities.

At MK TCG we have experienced consultants who can help your company make the transition ta new regulatory framework with the background and expertise required to train your employees.review the internal compliance program, classify your products. and make commodity jurisdiction and CCATS requests. Whether you are a supplier to or a sub of  one of the defense primes or an Unmanned Air Systems provider. we can assist your company in complying with the latest provisions of the regulatory changes.

Did you know that parts that are not "Specially Designed" but rather common to military and civilian aircraft and not found on the USML would be subject to the Export Administration Regulations? Did you know that parts and componcnts  may be exported or reexported in License Exception STA (Strategic Trade Authorization), but certain software and technology related to their "Development"' or "Production" may not be?

ITAR Categories VIII (military aircraft) and XIX (turbine engines) have already had regulations published with dramatic changes announced that would shift many items from State Department to Commerce Department control. Aerospace companies, among others, face penalties ranginfrom warnings and small fines to actual denial of export privileges and/or the prohibition against selling to the U.S. Government and they will face increasing pressure to 'put more significant resources into the effort to stay current with the new rules and regulations.