Why are some exports controlled?
The U.K imposes export controls on goods shipped to foreign countries, particularly with respect to sensitive goods and their destination and intended use. There are various reasons for having these controls in place, namely to protect human rights, prevent development of weapons of mass destruction, uphold commitments to EU and UN sanctions and embargoes and to protect the U.K and it’s allies from any threats to safety and security.
What considerations are taken in to account?
To determine whether an Export Licence is required, there are 4 major factors that will be considered;
- Nature – The majority of goods that are specifically intended (or modified) to be used for military purposes including any associated components will be controlled. This includes dual-use items i.e. “strategic goods” which, due to their nature, means they could be used for military or weapons of mass destruction (WMD) purposes without modification. This also includes associated technology and software. Other heavily controlled items include any goods that could be used for torture and radioactive sources, for obvious reasons. The U.K publishes various Export Control Lists detailing controlled items and also classifies them dependent on the items to be exported.
- Destination – If the goods being exported appear on the U.K’s Military List or are considered to be particularly sensitive items on the EU’s Dual-Use List, an Export Licence will be required for any destination, even within the EU. Less sensitive items on this list will need a licence only if being exported outside of the EU. The destination country may also dictate whether a licence is required, depending if any embargoes or sanctions are in place for that country.
- Ultimate End Use – Even if the goods themselves are not controlled, there may still be a need for an Export Licence if there are concerns about the end use of the goods. This could be related to the goods being used in either some form of WMD programme, or the exported goods being incorporated into military goods. It is also worth noting that it needs to be clearly established if the consignee for the goods is also the end user or whether they are a separate entity altogether.
- Trade Activity Licencing – This is relevant if the licensee is an agent or broker for example, who is trading in controlled goods between two overseas countries.
What types of Licences are there?
There are several types of Export Licence but the 3 main types are as follows;
- Open General Export Licences (OGELs) – these are pre-published licences containing set terms that the licensee must comply with. They are generally for less restricted goods and less restricted export destinations. The U.K currently has over 40 OGELs available, some covering military goods and others dual-use goods with a few of them covering both. OGELs can be a beneficial option if one is applicable, as this can save businesses time and money in avoiding SIEL applications for each export.
- Standard Individual Export Licences (SIELs) – In the event that an OGEL can not be utilised, a SIEL will need to be applied for. SIELs are specific to the company, consignee, quantity, value etc. of the exported goods in question. Supporting documentation needs to accompany the application including an End User Undertaking (EUU) completed by the end user. Further guidance and some FAQs relating to SIELs can be found here.
- Open Individual Export Licences (OIELs) – If a company needs to make 20 or more SIEL applications for a single long-term contract or project, then an OIEL may be a better option. The licensee will remain as a specific exporting company but the consignee, quantity and value of each export could change (unless fixed in the terms of the licence). It should be noted however that OIELs are reserved for companies with proven experience in exporting.
Currently, any application for an Export Licence or registration to use an OGEL needs to be done via the Export Control Organisation’s SPIRE system.
Access to Export has vast experience in managing and making Export Licence applications and we can assist you and your business with advice and practical support on Export Licensing. We can manage any Export Licence application on your behalf, to ensure export compliance and leave you free to secure your business’s next export order! Get in touch for a no obligation discussion about your Export Licence needs.