NC Export-Import Compliance: Safeguard Assets & Deals

Why Export-Import Compliance Matters for NC Businesses

North Carolina’s diversified economy—advanced manufacturing, aerospace, biotech, agri-food, and software—regularly intersects with U.S. export controls, customs rules, and sanctions. Noncompliance can cause shipment delays, loss of market access, contract defaults, civil and criminal penalties, and reputational harm. Proactive controls help protect margins, reduce deal surprises, and maintain eligibility for certain government contracting and financing opportunities.

Core U.S. Export-Control Regimes Touching NC Operations

U.S. export controls and sanctions commonly include: the Department of Commerce’s EAR for dual-use and commercial items (15 CFR Parts 730–774), the Department of State’s ITAR for defense articles, services, and technical data (22 CFR Parts 120–130), and the Department of the Treasury’s OFAC sanctions and embargoes (OFAC). Other regimes can also apply depending on activity (e.g., DOE nuclear assistance 10 CFR Part 810; NRC export and import of nuclear equipment and material 10 CFR Part 110). Obligations depend on classification, destination, end user, and end use, including certain purely domestic activities involving controlled technical data shared with foreign persons (deemed exports).

Product Classification: ECCN, USML, and EAR99

Accurate classification is the foundation of risk management. Determine whether your item is (a) ITAR-controlled on the U.S. Munitions List (22 CFR § 121.1), (b) governed by the EAR and assigned an ECCN on the Commerce Control List (15 CFR Part 738), or (c) EAR99 (generally low risk but still subject to destination, end-use, and end-user restrictions). Maintain written rationales with source citations and update logs when designs change.

Sanctions and Restricted-Party Screening

Screen customers, beneficial owners, intermediaries, and logistics partners against U.S. government lists, including OFAC’s SDN List (SDN Search) and the Consolidated Screening List (trade.gov CSL). Refresh screening at key milestones (quote, order, shipment, payment) and upon ownership or address changes. Pay special attention to countries and sectors subject to sanctions restrictions (OFAC programs). Document matches, false positives, and escalation outcomes.

End-Use and End-User Controls

Even EAR99 items can be restricted for certain end uses or end users. Evaluate red flags and obtain end-use certifications where warranted. The EAR’s end-use and end-user rules are detailed in 15 CFR Part 744. Train teams to stop and escalate if end-use information is refused, unusual transshipment is requested, or shell entities in high-risk locations appear.

Licensing Strategy and Exceptions

When a license is required, align timelines with sales and operations. Consider license exceptions under the EAR (15 CFR Part 740) where eligibility criteria are met and records are maintained. For ITAR-controlled items or technical data, ensure required registrations as applicable and any necessary authorizations are in place, and implement technology control plans before discussing controlled technical data with foreign persons (22 CFR Part 122).

Import Compliance for NC Companies

Confirm tariff classification, valuation, and country-of-origin determinations. Importers of record must exercise reasonable care and are responsible for the accuracy of entry data even when using brokers (19 U.S.C. § 1484; 19 CFR, including Part 141 and Part 152). Consider CBP binding rulings for clarity (19 CFR Part 177). Maintain supplier origin and contents declarations and monitor forced-labor enforcement, including UFLPA (CBP Forced Labor; DHS UFLPA). For specific rules of origin, see 19 CFR Part 102.

Technology, Cloud, and Deemed Exports

Cloud storage, collaboration tools, and remote work can result in a release of controlled technical data to foreign persons with access—even in the U.S. Under the EAR and ITAR, this can constitute an export or deemed export (15 CFR § 734.13; 22 CFR § 120.17). See BIS guidance on deemed exports and releases (BIS Deemed Exports). Implement data segregation, access controls, and encryption aligned to your risk.

Contract Clauses that Protect Deals

Embed export-import compliance in NDAs, supplier agreements, distributor contracts, and M&A documents. Consider representations and warranties on sanctions, classifications, licensing status, screening practices, and no debarment; include covenants for ongoing compliance, audit rights, termination for sanctions events, and clear allocation of penalties, detention costs, and recall or re-export obligations.

Internal Controls and Training

Adopt a written Export Management and Compliance Program (EMCP) or ITAR compliance program tailored to your risk profile. Define roles across sales, engineering, logistics, legal, and IT; use checklists for classification, screening, end-use diligence, and license tracking; deliver role-specific training; and keep records. See BIS EMCP guidance (BIS EMCP).

Voluntary Self-Disclosure and Mitigation

If you identify a potential violation, evaluate timely voluntary self-disclosure to the appropriate agency. Properly documented disclosures and corrective actions are often treated as mitigating factors (BIS: 15 CFR § 764.5; ITAR: 22 CFR § 127.12; OFAC Enforcement Guidelines). Coordinate disclosures across agencies when conduct spans multiple regimes.

North Carolina Touchpoints

Although export controls and sanctions are federal, NC businesses should also confirm state-level matters such as entity good standing and contract enforceability, and coordinate with NC-based universities, research institutions, and Foreign Trade Zones to manage access to controlled technical data. See NC FTZ resources (NC Foreign Trade Zones).

Practical First Steps Checklist

• Map your product and data portfolio; classify items and technical data with written rationales.
• Implement restricted-party and sanctions screening with audit trails and rescreening triggers.
• Build end-use and end-user diligence into order acceptance and logistics workflows.
• Establish an EMCP; train employees, contractors, and channel partners.
• Review and update contract templates to address export-import compliance.
• Draft an incident response and voluntary disclosure protocol.
• Schedule periodic internal audits and management reviews.

FAQ

Do North Carolina state laws change federal export-control obligations?

No. Export controls and sanctions are federal, but NC corporate, contract, and university policies can affect how you implement controls and who may access technical data.

Are EAR99 items always free to export?

No. EAR99 can still be restricted by destination, end user, or end use (e.g., military, WMD, or sanctioned parties).

What is a deemed export?

A release of controlled technology or technical data to a foreign person in the U.S., which can require authorization under the EAR or ITAR.

When should I file a voluntary self-disclosure?

As soon as you have a good-faith basis to believe a violation may have occurred and after promptly taking steps to stop the conduct and preserve records.

Can a broker handle import compliance for me?

Brokers can assist, but the importer of record remains responsible for reasonable care and accurate entries.

How Our Firm Can Help

We advise NC companies on classification, licensing, sanctions risk, import strategy, compliance programs, deal support, and investigations. Whether entering a new market, onboarding a supplier, closing an acquisition, or responding to an agency inquiry, we tailor solutions to protect assets and preserve deal value. Contact our team to discuss your needs.

Selected Sources

• EAR – 15 CFR Parts 730–774
• ITAR – 22 CFR Parts 120–130
• OFAC Sanctions Programs
• U.S. Consolidated Screening List
• OFAC SDN Search
• End-use and end-user controls – 15 CFR Part 744
• License exceptions – 15 CFR Part 740
• ITAR Registration – 22 CFR Part 122
• Importer reasonable care – 19 U.S.C. § 1484
• CBP binding rulings – 19 CFR Part 177
• CBP Forced Labor Enforcement
• Uyghur Forced Labor Prevention Act (UFLPA)
• EAR export and release – 15 CFR § 734.13
• ITAR export – 22 CFR § 120.17
• BIS Deemed Export Guidance

North Carolina-specific disclaimer

This blog provides general information, not legal advice, and does not create an attorney-client relationship. Laws and agency guidance change and outcomes depend on specific facts. For advice about your situation, consult qualified counsel licensed in North Carolina. This may be considered attorney advertising; past results do not guarantee a similar outcome.