My Keeper’s BrotherMy Keeper’s BrotherBeing a Responsible Third Party under the ITARBeing a Responsible Third Party under the ITAR

John Pisa-RelliLegal Director Trade ComplianceThales USA, Inc.john.pisa-relli@us.thalesgroup.com

Thursday 15 July 2010

Genesis 4:9Genesis 4:9

And the LORD said unto Cain, Where is Abel thy brother? And he said, I know not:

Am I my brother's keeper?

ITAR 127:1ITAR 127:1

Any person who is granted a license or other approval … is

responsible for the acts of employees, agents, and all authorized persons to whom possession of the licensed defense article or technical data has been entrusted….

Step 1: Build a BridgeStep 1: Build a BridgeStep 1: Build a BridgeStep 1: Build a Bridge

JVs, TAAs and other longer term JVs, TAAs and other longer term arrangementsarrangements

• Focus on building a transverse compliance teamFocus on building a transverse compliance team

Step 1: Build a BridgeStep 1: Build a Bridge

Customers, distributors, consignees,Customers, distributors, consignees,and other more “arm’s length” relationshipsand other more “arm’s length” relationships

• Focus on contractual and other assurancesFocus on contractual and other assurances

In all casesIn all cases

• Understand/overcome cultural differencesUnderstand/overcome cultural differences• Learn/respect local legal requirementsLearn/respect local legal requirements• Identify and enlist foreign party’s U.S. affiliatesIdentify and enlist foreign party’s U.S. affiliates

Step 2: ShareStep 2: Share

KnowledgeKnowledge

• Educate your partnerEducate your partner• Empower your partnerEmpower your partner

Step 2: ShareStep 2: Share

ResourcesResources

• Help your partnerHelp your partner• Protect your partnerProtect your partner

RisksRisks

• Protect yourself at the end of the dayProtect yourself at the end of the day• Use voluntary disclosure as lever to encourage buy-in Use voluntary disclosure as lever to encourage buy-in

Step 3: Preserve Supply Chain IntegrityStep 3: Preserve Supply Chain Integrity

Make ITAR § 123.9 gospelMake ITAR § 123.9 gospel

• Impose controls to tag and track ITAR-controlled Impose controls to tag and track ITAR-controlled articles and dataarticles and data

• EveryEvery intermediate and subsequent transfer must be intermediate and subsequent transfer must be identified and authorized by license, retransfer identified and authorized by license, retransfer approval or exemptionapproval or exemption

• Unauthorized retransfer one of the most common Unauthorized retransfer one of the most common compliance lapses on part of foreign partiescompliance lapses on part of foreign parties

Step 3: Preserve Supply Chain IntegrityStep 3: Preserve Supply Chain Integrity

It takes two to tango…It takes two to tango…

but only one to stumblebut only one to stumble