Advising on export licensing and international export controls for transferring defense technology abroad

As a Korean company pursued a business providing defense-related manufacturing technology and technical assistance to a foreign company, we advised on its export licensing obligations under the Foreign Trade Act and the Defense Acquisition Program Act and on whether international export control rules applied.

The questions were whether the overseas manufacturing technical assistance required an export license for strategic items and an export license for defense science and technology, and whether on-site technical guidance abroad and technical training given to foreign nationals in Korea also counted as exports.

Other key issues were how far discussions with the customer and negotiation of contract terms could proceed before a license was obtained, and whether the export control rules of particular countries applied when using technology originating in a third country.

We analyzed the relevant statutes and the Public Notice on the Export and Import of Strategic Items to determine whether the technology to be provided was controlled and what licensing procedures were required. In particular, we analyzed export licensing obligations not only for the transfer of technical data but also for various forms of technical assistance, including education, training and on-site technical guidance.

We also reviewed whether preliminary export approval was needed, the scope of business activities permitted before a license was issued, and whether additional export control rules could apply depending on the origin of the technology and its end user.

We advised that the technical assistance required a government export license, and set out the additional licensing procedures depending on whether the technology qualified as defense science and technology, as well as the business activities permitted before a license was issued. We also advised that the origin of the technology alone does not determine whether a particular country's export controls apply.