Export Compliance Program Fourth Element: Recordkeeping

July 21, 2021

(The Exporting Source) by Blake Gill *

In our last discussion, we reviewed the third element of Export Authorization. Once you have determined your path to exporting an item in a legal, compliant manner, you must keep the supporting documentation. Recordkeeping is mundane, I’m sure we can all agree upon that, yet is critical in protecting you in the future. If an issue arises but you have documentation to support your decision, you face a much easier path than had you been “winging” it!

The Export Administration Regulations (EAR) dictates recordkeeping in part 762. In this part, the regulations describe how long to keep records, what type of records to keep, how to reproduce records if they are requested, and which documents are exempt from retention. While part 762 guides you on recordkeeping, it is not all-encompassing. Some documentation may not be required but is in the best interest of the company to be retained.

Creating a recordkeeping system will help the organization be consistent in successful recordkeeping. The system will be dictated by the company putting it to use; sometimes an electronic system is the best solution for a company, others will find greater success in a paper hard copy system. Each system will have its own set of pros and cons; however, most important is that the process is consistent, reviewed frequently, and audited.

While some elements of recordkeeping are up to the organization to determine, others are not. Section 762.6 of the EAR advises that parties are required to keep export records for “five years from the latest date of export or reexport activity” from the U.S. It is incredibly important for you and your company to understand what actions justify the definition of this activity.

Now that you and your organization understand what to record and when to record it, roles and responsibilities must be established within your organization that determine who is responsible for these actions. Procedures for who will do the recording, when the recording will occur, and where the records will be kept is critical for successful recordkeeping.

Keep in mind that recordkeeping is not synonymous with physical shipments. Deemed exports and transfers of technology also require records to be kept. This includes hiring foreign nationals, visitor sign-in sheets, employee training, and company provided services. Also remember that each regulatory body has their own set of requirements.

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* Blake Gill is an experienced International Trade Compliance professional with a demonstrated history of work in the technology industry. He has many years of experience working with export control, customer screening and item classification over a wide variety of products. Additionally, Blake has performed the duties of Empowered Official at multiple international companies.