ITAR Compliance Checklist
By Nathan Rubenstein. Posted Thursday August 1, 2019 in Blog.

It goes without saying that the United States doesn’t want defense-related weaponry to fall into the wrong hands, which is why the government’s oversight of military equipment is far stricter than it is for other types of exports.

The set of rules that governs exports found on the U.S. Munitions List (USML) is called the International Traffic in Arms Regulations (ITAR) — its purpose is to ensure defense technology and technical information passes only through the hands of those who are permitted to receive it.

Who Needs to Be Compliant With ITAR?

Any company that conducts business relating to defense articles is required to be fully compliant with the ITAR. While it’s fairly obvious that governmental and military institutions fall under this umbrella, it’s important for third-party civilian organizations to understand they’re also mandated by these regulations if they fall within the supply chain of information or products that service the armed forces. This includes, but is not limited to contractors, wholesalers, distributors and technical companies.

It is up to each company that handles items found on the USML to create and maintain its own ITAR compliance program. Only United States citizens are permitted to access the information and materials listed on the USML, barring a few exceptions, which require strict governmental intervention before they can be approved. This is to ensure that sensitive information and devices aren’t shared with unauthorized users or enemies of the U.S.

Compliance is imperative, as a breach of ITAR can result in significant penalties (both criminal and civil), as well as severe damage to a brand’s reputation and the likely loss of government contracts to competing firms.

ITAR Compliance Checklist

Adhering to ITAR compliance requirements means your company has successfully registered with the State Department’s Directorate of Defense Trade Controls (DDTC) and agrees to understand and abide by ITAR as it applies to goods, services and information (as dictated by the USML). Failure to comply can result in civil fines as high as $500,000 per violation and criminal fines of up to $100,000 per violation, in addition to possible prison sentences.

The following are some ways your company can ensure it is meeting ITAR regulations properly:

  1. Institute a data classification system

Data management can be one of the most difficult things for companies to nail down when it comes to ITAR. While not all data that flows through your business will need to be ITAR compliant, it’s essential to capture and categorize all incoming and outgoing information to ensure nothing falls into the hands of someone who isn’t permitted to see it.

Consider classification systems such as the following:

  • “For public use”
  • “Internal use only”
  • “Confidential”

This will help you track data so you can easily identify the persons who are eligible to receive it.

  1. Familiarize yourself with potential ITAR violations

Understanding common pitfalls is one of the easiest ways to ensure your organization is air-tight. While mistakes may happen, strict policies and regular reinforcement and reminders of the possible problems will help your staff relate to the vital necessity of proper compliance. Use existing case studies to demonstrate how accidentally sending data through an unsecured channel or to an unauthorized person has impacted other organizations and workers.

  1. Be proactive with network scans and analytical tools

It’s never a good idea to do first and ask for forgiveness later when it comes to imports and exports. Today’s technology enables you to create encryption methods, employ internal scans of incoming and outgoing data, and safeguard yourself against malicious attacks that could compromise the well-being of your company. When you’re able to easily identify suspicious activity, you can proactively put problems to rest before they evolve into more serious matters. Utilize the tools available to you to ensure the data and products you’re exporting are protected.

How do you know if your ITAR compliance plan is comprehensive enough to keep your company protected? That’s where Vigilant can help. We have extensive experience in managing ITAR related activities for our clients and offer compliance screening that can help ensure your organization meets the standards of today’s ITAR regulations. Learn more about our services today.

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