Maryland Export-Import Compliance: Safeguard Assets

Why Export-Import Compliance Matters in Maryland

From the Port of Baltimore to defense, biotech, cyber, and advanced manufacturing corridors, Maryland businesses interact with global supply chains and controlled technologies. Effective compliance protects revenue, licenses, data, and reputation, and reduces the risk of penalties, shipment delays, and loss of market access. Robust programs also support diligence in M&A and investment, where trade controls can materially affect valuation.

Core U.S. Trade Control Regimes Affecting Maryland Businesses

Most export and import obligations arise under federal law, which apply to Maryland entities and activities within the state:

• Export Administration Regulations (EAR) administered by the U.S. Department of Commerce’s Bureau of Industry and Security (BIS), governing dual-use items, software, and technology, including deemed exports to foreign nationals in the U.S.
• International Traffic in Arms Regulations (ITAR) administered by the U.S. Department of State’s Directorate of Defense Trade Controls (DDTC), covering defense articles, services, and technical data on the U.S. Munitions List.
• U.S. economic and trade sanctions administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC), including restrictions on transactions, services, and facilitation involving sanctioned countries, persons, and sectors.
• U.S. Customs and Border Protection (CBP) import rules, including tariff classification, valuation, country of origin/marking, forced labor prohibitions, and recordkeeping; see CBP Trade.

Maryland firms should also consider anti-boycott rules, export and import recordkeeping, and data controls that intersect with cybersecurity and privacy obligations.

Maryland Touchpoints: Port Operations, FTZs, and State Resources

The Port of Baltimore is a major gateway for autos, breakbulk, and project cargo. Foreign-Trade Zones (FTZs) can enable duty deferral and other federal tariff benefits for qualifying operations; see the Foreign-Trade Zones Board. Maryland state agencies and regional partners provide trade promotion, compliance education, and export assistance that can be integrated with internal controls. When leveraging FTZs or state programs, align federal licensing and screening protocols to avoid conflicting procedures.

High-Risk Areas to Monitor

• Technology transfers and deemed exports to foreign nationals (EAR/ITAR technical data access).
• Research collaborations and lab environments (universities, life sciences, aerospace/defense) where controlled technology or encryption is present.
• Sanctions exposure via customers, suppliers, freight, financial flows, and cloud services.
• Third-country transshipments and reexports, including distributor networks.
• Country-of-origin, forced labor enforcement, and supply chain traceability for imports.
• M&A, joint ventures, and investment that involve controlled products or data.
• Automated classification and screening tools without human review or escalation paths.

Building a Right-Sized Compliance Program

• Governance: Assign accountable owners, define escalation, and brief leadership on risk appetite.
• Risk Assessment: Map products, software, technology, destinations, parties, and end uses; identify licensing and sanctions touchpoints.
• Classification: Determine ECCNs/USML categories and HTS codes; document rationales and maintain version control.
• Licensing and Authorizations: Evaluate license exceptions, provisos, and agreements (e.g., ITAR TAA/MLA); track conditions and expirations.
• Screening: Implement restricted party, sanctions, and end-use/end-user screening at onboarding and pre-shipment, with re-screening triggers.
• Technology Controls: Segment networks and repositories; adopt access controls for controlled technical data; manage deemed export reviews.
• Supply Chain Controls: Vet freight forwarders and customs brokers; monitor transshipment risks; establish proofs for origin and forced labor compliance.
• Training: Role-based, practical, and refreshed; include developers, researchers, shipping, sales, and finance.
• Audits and Monitoring: Conduct periodic audits, test red flags, and remediate findings; document corrective actions.
• Incident Response: Prepare voluntary disclosure workflows and cross-functional playbooks for detentions, cyber events, or screening hits.

Protecting Corporate Assets and Transactions

Compliance rigor supports enterprise value. Buyers and lenders scrutinize export licensing, sanctions exposure, and import compliance during diligence. Well-documented classifications, licenses, and corrective actions can reduce holdbacks and representations/indemnities. For technology companies, cleanroom procedures, encryption reviews, and access controls help preserve IP and reduce operational disruptions.

Quick Tips for Maryland Companies

Checklist: Pre-Shipment and Onboarding

Practical Steps for Maryland Exporters and Importers

• Confirm classifications and maintain a master database tied to engineering change control.
• Map data flows so controlled technical data is not stored or accessed from restricted jurisdictions.
• Align purchase/sales contracts with compliance obligations (screening, origin, sanctions, anti-boycott, audit rights).
• Coordinate with customs brokers and freight forwarders on license flags, routings, and documentation holds.
• Establish pre-shipment checkpoints for sanctions and end-use red flags.
• Maintain clear, retrievable records supporting filings, entries, and license determinations.
• Schedule periodic tabletop exercises, including a voluntary disclosure scenario.

When to Seek Counsel

Seek counsel when you identify potential violations, receive agency inquiries or detentions, plan to share controlled technology with foreign nationals, expand into higher-risk markets, contemplate defense-related collaborations, or prepare for a transaction where trade controls may affect valuation or timing.

FAQ

Do Maryland-specific laws change federal export/import obligations?

Most requirements are federal and apply in Maryland. State programs (such as FTZ participation or grant support) should be aligned with your federal controls to avoid procedural conflicts.

What is a deemed export?

Providing controlled technology or technical data to a foreign national in the U.S. can constitute an export under the EAR or ITAR, potentially requiring authorization.

How often should we rescreen business partners?

At onboarding and pre-shipment, with rescreening triggered by changes such as ownership, routing, product, destination, or sanctions updates.

What records should we keep?

Maintain classifications, screening results, licenses and provisos, shipping documents, filed entries, and communications supporting determinations, typically for at least five years depending on the regime.

Citations

• U.S. Department of Commerce, Bureau of Industry and Security (BIS)
• U.S. Department of State, Directorate of Defense Trade Controls (DDTC)
• U.S. Department of the Treasury, Office of Foreign Assets Control (OFAC)
• U.S. Customs and Border Protection (CBP) — Trade
• International Trade Administration, Foreign-Trade Zones Board

Disclaimer

This post provides general information for Maryland businesses and is not legal advice. Reading it does not create an attorney-client relationship. Laws and guidance change, and application depends on specific facts. Consult counsel about your situation.

Need tailored guidance? Our team advises Maryland exporters and importers on EAR, ITAR, sanctions, and customs compliance. Contact us.