Permanent vs. Temporary Importation: ITAR vs.

As people become familiar with the International Traffic in Arms Regulations (ITAR), they are often surprised to learn that the regulations not only control exports, but also have certain provisions for temporary imports.

In one of the more concise sections of the regulation (ITAR 120.53), temporary importation is defined as follows:

“…bringing into the United States from a foreign country the following defense articles:

1. return it to the country from which it was sent or from which it was taken; or
2. Any defence article that is in transit to another foreign destination.”

The definition includes “the withdrawal of defense articles from a customs bonded warehouse or foreign trade zone for shipment back to the country of origin or shipment, or to another foreign destination.”

A common situation that is classified as a temporary import is bringing something into the U.S. for service or a one-to-one replacement. Other examples include equipment used for display at a trade show or for private demonstrations to potential customers.

Permanent imports, on the other hand, are goods brought into the United States for domestic consumption.

For example, importing guided artillery shells for testing and possible sale to the U.S. government is a permanent import because the shells are consumed domestically; once fired, they cannot be returned.

So the first question that needs to be resolved is whether the import is temporary or permanent. But this also raises the question: if the International Traffic in Arms Regulations, which are administered by the State Department, control temporary imports, then who controls permanent imports?

As stated in ITAR 120.53, these are “regulated by the Attorney General under the direction of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) of the Department of Justice.”

Companies working in defense-related fields that are accustomed to complying with the International Traffic in Arms Regulations may not realize that some of their activities may require a license from the ATF.

Both agencies were given these responsibilities under the Arms Export Control Act of 1976, so while there are two different agencies overseeing potentially related import activities, their regulations share some similarities.

U.S. Arms List and U.S. Arms Import List

ITAR controls on temporary imports apply only to items on the United States Munitions List (USML), which is administered by the Directorate of Defense Trade Controls (DDTC).

ATF controls on permanent imports apply to items on the different but similarly named United States Munitions Import List (USMIL).

If an item appears on the USML, you will need permission from DDTC to import it temporarily. This permission may be in the form of a license or exemption.

If something is USMIL, you need ATF permission to import it permanently, either by obtaining a license or an exemption.

Many items appear on both lists, but they are not identical. Some items that appear on the USML do not appear on the USMIL—which means that items that cannot be brought in temporarily without prior approval can actually be brought in permanently.

Both lists follow the same structure (see chart) and were once relatively similar, but over time they have diverged, and comparing their high-level categories clearly shows the difference between the issues each list focuses on.

The International Traffic in Arms Regulations and the United States Arms Act focus on national security and prevent certain U.S. military materials from being used by hostile forces. They cover not only weapons and ammunition, but also things like body armor, advanced electronics and certain satellite technology.

ATF and USMIL are more concerned with domestic security and counterterrorism, focusing on firearms and explosives. The ATF list includes more firearms than ITAR, including semi-automatic weapons, which no longer appear in USML. But it does not care about military electronic equipment, night vision systems, etc.

Comparison of the US Arms List and the Arms Import List

Companies involved in the production of explosives are accustomed to these nuances. However, companies involved in other defense-related fields may not be aware that certain import activities require a license from the ATF.

Registration

The requirements and processes for obtaining import licenses under ITAR and ATMA are similar, but not identical. Both require entities importing controlled items to register.

DDTC administers the registration of export/import activities subject to ITAR using Form DS-2032, which must be submitted through the Defense Export Control and Compliance System (DECCS) electronic portal. Registration fees start at $2,250 per year through March 2023.

Applications to register as an importer with ATF are processed on ATF Form 5330.4. Beginning in March 2023, fees start at $250 per year.

Both statutes also have recordkeeping requirements.

Licenses, permits and exemptions

The process for obtaining a Temporary Import License under ITAR (for items on the USML) varies depending on whether the item is classified or unclassified. The application form for unclassified items is Form DSP-61; the application form for classified items is Form DSP-85.

Obtaining an import license through ATF begins with completing ATF Form 6.

Both statutes allow for exemptions from the usual license or permit requirements. For example, if the activity is conducted under contract with the Department of Defense, an ATF import license is not required for items on the USMIL.

Section 123.4 of the International Traffic in Arms Regulations provides exemptions to temporary import licenses. The ATF provides a list of license exemptions on its website.

Need more guidance? Check out our latest on-demand webinar: A Beginner’s Guide to Navigating ATF Controls.

Do you have questions about permanent and temporary importation? Visit www.learnexportcompliance.com to learn about our company, our faculty, our staff, and our highly regarded Export Compliance Professional (ECoP®) certification program. To find upcoming e-seminars, live seminars, and live webinars, and to browse our catalog of more than 80 on-demand webinars, visit our ECTI Academy. You can also call the Export Compliance Training Institute (540-433-3977) for more information.

Scott Gearity is President of ECTI, Inc.