Government Contracts Legal Blog

Export Administration Regulations (EAR) Focused on Hacking

Posted by Dan McAuliffe on Jan 17, 2017 2:31:51 PM
Dan McAuliffe
Find me on:
International Business Law Attorney

Don’t Be Like Those Guys

The Bureau of Industry and Security (BIS) has added five Russian entities to the Entities List that are now prohibited from doing business with the United States because they are involved in activities contrary to the national security or foreign policy of the United States.  This is meant to be a “tongue-in-cheek” reminder that the Federal government has export licensing requirements and the failure to follow these requirements results in a ban on doing any import/export-related business.  These entities violated the Government's Export Administration Regulations when they engaged in illegal hacking operations

Export Administration Regulations

The law, the Export Administration Regulations or “EAR,” imposes licensing requirements on exports, reexports, and transfers (in-country) to persons or entities listed on the Entity List. Entities are placed on the list by the BIS based on certain sections of part 744 (Control Policy: End-User and End-Use Based) and part 746 (Embargoes and Other Special Controls) of the EAR.

In this case, because of the recently reported Russian hacking activities, the End-User Review Committee (ERC), composed of representatives of the Departments of Commerce (Chair), State, Defense, Energy, and Treasury, met and unanimously voted to add five Russian entities to the list. The legal basis for adding these entities to the list was a violation of Executive Order 13694 that allows the “Blocking the Property of Certain Persons Engaging in Significant Malicious Cyber-Enabled Activities.”

However, when it comes to importing and exporting, you don’t have to be a Russian hacker to violate EAR. In fact, businesses often may not even know about the existence of the EAR regulations before they violate them. And, a violation is strictly construed, meaning a business does not have to have intended to violate the regulation to be liable criminally or civilly (and the penalties are significant).

To learn more about the recent U.S. action you can visit the Federal Register's website

To learn more about EAR and to prepare yourself for your future international business transaction, please contact us. WSM PC can guide and help you to avoid entanglements and becoming like those guys.

Contact One of Our Attorneys

Topics: International Law

Government Contracting is not for the uninformed

Tune in here for the latest in legal news surrounding government contracting

Whitcomb Law, PC is dedicated to helping government contractors extract all the benefits that can be derived from doing business with federal, state, and local governments.  We strive to provide content on this blog that is up-to-date, relevant, and easy to read.  We enjoy reading your feedback especially when it helps us improve the way in which we serve you.

Our sources of information include

  • Recent rulings by the Court of Federal Claims
  • FAR Council
  • SBA rule makers
  • Center for Verification and Eligibility
  • News media
  • Our Clients

Subscribe to Our Legal Blog

Recent Posts