What Are Export Controls?

C. Mitchell

Export controls are national laws through which a government restricts the kinds of things that can and cannot leave the country. Most export controls are geared towards goods related to national security or military defense. Controls can also attach to goods considered scarce or goods destined for certain embargoed or restricted destinations.

Governments establish export controls to restrict products that can be imported and exported.
Governments establish export controls to restrict products that can be imported and exported.

In international trade, exports, like imports, play an important role. Exports are sometimes facilitated directly by and between governments. More frequently, individual corporations arrange exports as business-to-business transactions. Government-mandated export controls set out the contours and conditions under which these sorts of exports can take place.

The United States currently holds a trade embargo against Cuba.
The United States currently holds a trade embargo against Cuba.

At their most basic, export controls concern goods of national importance. If a country needs a certain amount of wheat to feed its own people, for instance, or a certain amount of oil to fuel its own cars, export controls will limit the percentage of these goods that can be exported. Temporary or limited export controls can also be implemented to compensate for times of famine or scarcity. If a wide swath of crops is destroyed by natural disaster or disease, export controls may severely curtail how much can be exported, even if heavy exportation is, in good years, the norm.

Most export laws in the United States and Western Europe concern military exports. These countries place tight restrictions on the kinds of military technology — both weapons and strategy — that can cross borders. National security depends in large part on military strategies and advantages being closely held. As such, most governments do not want their secrets shared, even with friendly countries. Most export controls allow some military exchanges, but only in certain carefully prescribed circumstances.

Governments also regularly curtail exports to countries that are embargoed or otherwise restricted for trade. Nations that participate in such world forums as the United Nations and the World Trade Organization usually come to agreements amongst themselves with respect to the proper terms of international trade. Countries that refuse to follow set rules or that engage in widely condemned activities like terrorism or human rights violations often find their trade options restricted.

Whether a country elects to restrict trade to a so-called “blacklisted” destination is a matter of national choice. The export of goods to Cuba, for instance, is embargoed in the United States but not in most of Europe. North Korea and Iran are also examples of countries to which trade is restricted or banned in some places, but not in others. Countries set and enforce these prohibitions through export controls.

Export controls typically apply to all exports, no matter how small or erratic. A company exporting computers is just as subject to the controls as an individual bringing clothing to a host family abroad. Being subject to controls does not mean that any action is necessarily required, however. The controls act like parameters, and so long as activities stay within the boundaries, it is unlikely there will be any problem.

Trade to North Korea is restricted in some places.
Trade to North Korea is restricted in some places.

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