The USML list also contains the items containing military end-use software and the diagnostic software that help in designing to assist in repairing the defense articles.
While developing or licensing the software, the company may violate the ITAR regulations through improper disclosure and transferring the online application to an unauthorized exporter. The risks that are associated with infringement of the ITAR regulations are administrative fines up to $500,000 per violation of the regulations.
The companies that are violating the export rules and regulations can face suspension and debarment from all type governmental contracts, forfeiture of the defense article, seizure of export article and also prevent to enjoy all the export privileges. Potential crimes are dangerous. In such situations, the exporters have to pay $ 1 million per violation and sometimes 10 years of imprisonment.
In most of the cases, software exports consist of disclosing the source code to any foreign entity by oral and written means. The ITAR violation occurs when the software is used for performing various defense services to a foreign business entity.
The defense service is mainly classified and includes everything from designing and developing the defense item to repair and maintenance during the life cycle of the item. The defense service also includes managing the item till the end of the life cycle by the process of demilitarization and destruction of the same.
The initial step to determine whether the software application is a defense item is to know how ITAR regulations are applied to the software. The regulations that are applied to the software are listed on the USML list like the military cryptographic application. The software that is not listed under the USML list is categorized as ITAR technical data.
The software application that is defined by ITAR consists of system functional design, algorithms, logic flow, application programs, support software for designing, implementation, diagnosis, operational systems and repair.
The software that is used for the assurance systems, security and for other devices with the below capabilities is mainly controlled under the ITAR regulations because they are listed under the USML list.
- Software capable of maintaining the secrecy and confidentiality of the information systems, telemetry, decryption, encryption and software for tracking.
- Software that is capable of generating the spread or hopping codes for spreading of the spectrum systems and other equipment.
- The software applications that have the cryptanalytic systems
- Software that is helpful in maintaining the authorization of the control access for the technical data that are listed on the United Cross Domain Management Office Control List
With the evolution of export software, the exporters can now check exporting products, vendors, suppliers, freight forwarders and the customers. There are various companies that offer online applications to make export business legal and free from obligations.
