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The U.S. Citizenship and Immigration Services recently modified some of the forms used by employers to petition for employment authorization on behalf of foreign nationals.[1] One modification is the addition of a certification requirement to Form I-129. Since this requirement became effective a couple of months ago, employers seeking to employ foreign nationals in the H-1B, L-1 or O-1A categories have had to contend with complex clearance procedures under the Export Administration Regulations ("EAR") and the International Traffic in Arms Regulations ("ITAR"). The purpose of the certification requirement is to prevent the unauthorized release to foreign nationals of sensitive technology, technical data[2] and software that could have national security and foreign policy implications.
Under the EAR, providing foreign nationals with access to sensitive technology or technical data in the United States is "deemed" to be an export of such goods to the person's country of nationality, which may require a license before release. Similarly, ITAR imposes a licensing requirement on the release of controlled defense articles or technical data included on its munitions list.
The new certification requires a company to attest that it has reviewed the EAR and ITAR and determined that either (i) a license is not required to release technology or technical data, or (ii) a license is required for such release but the company will prevent access by a foreign national to such information until a license is secured. The consequences of not complying with export laws can be severe, including civil fines of up to $500,000 per violation, criminal penalties of up to $1 million per violation and up to 10 years in prison, denial of export privileges, and debarment from U.S. government contracts.
Export Requirements
The analysis required to execute an informed certification can be complicated and burdensome. It begins with a determination of the type of technology or technical data to which the foreign national will likely be given access. This determination requires consultation with company officials who understand product design and uses and with information technology personnel who are familiar with software applications.
Next, the company must determine how that technology or technical data will be classified for export purposes. The first consideration is whether the product is on the Commerce Control List ("CCL") administered by the U.S. Department of Commerce's Bureau of Industry and Security. The technical characteristics and functions of the product determine whether it falls within one of the 10 categories of controlled items listed on the CCL (e.g., Information Security is one of the categories) and whether the product has an Export Control Classification Number, which describes the technical characteristics of controlled products and any related export restrictions. If a product is on the CCL, then the company must consider the nationality of the foreign worker. This information is necessary to access the Commerce Country Chart to determine whether a license is required to export the item.
The U.S. Department of State's Directorate of Defense Trade Controls administers the ITAR U.S. Munitions List of technologies designated as controlled defense articles.
Compliance Considerations
Although most technology is not controlled for export, the company should nevertheless conduct an analysis to be sure an export license is not required to release certain information to foreign nationals. Situations that should be closely examined include the release of technology, technical data or software to foreign workers involved in research and development, and foreign students and scholars involved in research. Technologies that require licensing for transfer to foreign nationals are often "dual-use" (i.e., have both civil and military applications) and relate to critical control areas, such as national security, nuclear proliferation, missile technology, or chemical and biological warfare.
Finally, technologies that are "publicly available" are not subject to EAR and ITAR licensing controls. These include publicly available technology and software (other than software and technology controlled as encryption items) that are already published or will be published.
For more information about the new Form I-129 certification requirement and how to manage compliance with the requirement, please contact our director, Compliance Risk Services, Jim Bowers at (860) 275 0339 or jebowers@daypitney.com.
Day Pitney Attorneys Daniel Schwartz, Michael Lane and Lindsey Viscomi authored the article, "Don't Be Late Paying Terminated Employees in Massachusetts," for Law360 Employment Authority.
Day Pitney Employment and Labor attorneys Glenn Dowd and Lindsey Viscomi will be presenting "Critical HR Transactions," at the CBIA 2022 Human Resources Conference on March 17 at the Trumbull Marriott Shelton.
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Day Pitney Employment and Labor Partner Rachel Gonzalez was featured in the Diverse Lawyers Network newsletter for being a recipient of the Executive Women of New Jersey Salute to the Policy Makers Award.
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Attorneys Kritika Bharadwaj, Benjamin E. Haglund, Theresa A. Kelly, Naju R. Lathia and Elizabeth J. Sher represented the firm at the South Asian Bar Association of New Jersey (SABA-NJ) 2021 Annual Gala on October 1 at The Marigold in Somerset, NJ.
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This website may use cookies, pixel tags and other passive tracking technologies, including Google Analytics, to improve functionality and performance. For more information, see our Privacy Policy. By using our website, you are consenting to our use of these tracking technologies. You can alter the configuration of your browser to refuse to accept cookies, but if you do so, it is possible that some areas of web sites that use cookies will not function properly when you view them. To learn more about how to delete and manage cookies, refer to the support instructions for each browser (e.g., see AllAboutCookies.org). You may locate Google Analytics' currently available opt-outs for the web here.