‘- Written by Elmira Shahbazi
What Are Dual-Use Items?
Dual Use Products are products such as software and technological devices that are designed for civilian purposes, but can also be used for military purposes.
These may be represented by any form of object or software susceptible for use in the production of armaments. This includes, but is not limited to, nuclear, chemical, or biological explosives aimed at terrorist purposes.
The export of these types of products is subject to strict control for compliance with national interests as well as international commitments and agreements.
In some cases, the export of these products is prohibited. In others, it is subject to a prior authorization by the competent National Authority, the UAMA (Armament Material Authorization Unit).
Relevant legislation
The regulation on controls of «dual use» products was born in 2000 with the introduction of the CE Regulation 1334/2000. Over the years and with the proliferation of products that can be considered dual, the discipline has been constantly modified and updated by several regulations.
It may be useful to recall the CE Regulation 428/2009, which led the Italian government to adopt the Legislative Decree 221/2017 to harmonize the Italian law with the European standards.
In recent years, two regulations have particularly modified the discipline of export controls: specifically, the CE Regulation 821/2021 which reformed the export control procedure by establishing a system of authorizations issued by the Ministry of Foreign Affairs and International Cooperation, and the CE Delegated Regulation 1/2022, which replaced and expanded the list of dual use items included in Annex I of the CE Regulation 821/2021.
In addition, CE Regulation 821/2021, introduced two other new developments: the requirement to establish an Internal Compliance Program (ICP) when applying for authorizations, and a new e-Licensing system for the application of export authorization.
Internal Control Program (ICP)
The provisions of the CE Regulation 821/2021 expanded the range of possible export authorizations, making them subject to the prior establishment of an Internal Compliance Program, which allows the exporter to be «aware» of the regularity and compliance of its activities.
This program, whose efficacy must be constantly monitored by the company, by the assessment of potential risks that may affect certain exports, involves several steps
The company can freely choose the organization of its Internal Program, keeping in mind that an efficient and functioning system will have the dual effect of speeding up export licensing procedures as well as supporting national authorities in dealing with terrorism and weapons proliferation.
To summarize, the basic points that an efficient Internal Program should follow are:
- Analysis of the potential duality of the item, by using the ECCNs (Export Control Code Number);
- Verification of all available information regarding business operations, starting from the first contact with the foreign customer;
- Supervise internal activities aimed at fulfilling export procedures;
- Verify the identity and trustworthiness of the recipient of the product, through a request for an End User Statement;
- Follow the arrival of the product at its destination and check that it is used for its stated purpose.
Setting up an Internal Program to deal with these operations would not only have an ethical value, to assist the Peacekeeping and Anti-Terrorism Authorities, but also, a practical value, as it would make it possible to anticipate the assessments of the MISE Export Control, and consequently speed up and simplify the entire licensing procedure.
E-Licensing System
The last big innovation introduced in the area of dual-use items is the implementation of an electronic system for managing the procedures for issuing export authorizations (the so-called e-Licensing system), which as of July 1, 2022, entirely replaced the paper-based mode.
For this reason, it has become necessary to know how to use the electronic system in order to continue exporting dual-use items and technologies without delay.
- First, it is essential for the exporter to have his or her ECAS Identity, also known as EU Login, which is the digital identity of every citizen of the Union Europe, necessary to access any EU digital program.
- Once the ECAS Identity is obtained, it will be possible to access the e-Licensing platform, and after filing the company-related documents required by the system, it will be possible to be registered as a «European economic operator.»
- Once registration is completed, you will be able to use the platform to obtain the necessary authorizations for the worldwide export of dual-use items.
If your company exports dual-use products and wants to avoid sanctions, export blocks, or delays in obtaining authorizations, we can offer you our expertise in defining and implementing an effective internal control program, as well as managing the necessary export authorizations. Contact us.
