1. Category I’s scope would be limited.

Under the proposed rule, Category I of the International Traffic in Arms Regulations’ (ITAR) United States Munitions List (USML) would no longer include non-automatic and semi-automatic firearms up to, and including, caliber .50 (12.7mm). Nor would it include the parts, components, accessories, and attachments that are specially designed for such firearms.

Instead, these articles would be controlled under the Export Administration Regulations’ (EAR) Commerce Control List (CCL) as Export Control Classification Numbers 0A501, 0A502, 0A503, 0A504, 0A505, 0B501, 0B505, 0D501, 0D505, 0E501, and 0E502, as appropriate.

2. Categories II and III will be more specific.

At present, Categories II and III of the USML contain broad “catch-all” language that provides little in the way of certainty. The proposed rule would change that, and Categories II(a) and III(a) and (d), specifically, will be updated to enumerate, with precision, the articles controlled thereunder.

3. Brokers beware.

The proposed rule makes clear that firearms, ammunition, and related components and defense services transitioned to the EAR may still be subject to the ITAR Section 129 brokering restrictions.

More specifically, the proposed rule stipulates that all items identified on the United States Munitions Import List for “permanent import purposes,” whether they be controlled for export purposes under the ITAR or the EAR, will remain regulated under Section 129.

4. Conduct your EAR licensing assessment carefully. 

There is no question that the EAR is a more liberal licensing regime than the ITAR. That said, it does contain strict and, in many cases, complex, licensing requirements. Accordingly, carefully assess how your firearms of interest are classified under the CCL before reconfiguring your export strategy.

5. Standby for 45 days. 

Interested parties still have approximately 45 days to comment on the proposed rule. As such, you should review the final rule upon its release to determine whether changes made during the comment period will impact your licensing obligations.

About the Authors

Downrange authors Jennifer Huber and Adam Munitz are Partners in Fluet’s International Trade + Transactions Practice.  Focusing primarily on the defense, security, and intelligence sectors, Jennifer and Adam help businesses translate their domestic successes into overseas growth and assist foreign entities with sensitive investments in, and acquisitions of, U.S. businesses.

Additional information regarding their capabilities and previous representations can be found on the International Trade + Transactions practice page.