License validity, transfers and revocation

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1. The standard validity period

The Export Administration Regulations (EAR) set a default term for licenses (15 CFR 750.7(g)). Licenses for exports or reexports generally have a four-year validity period, unless the Bureau of Industry and Security (BIS) has approved a different period or one is specified on the license (15 CFR 750.7(g)). Licenses for items controlled for short supply reasons are limited to one year. Emergency licenses expire no later than the last day of the calendar month after the month of issue. The expiration date is stated on the license, and if it falls on a federal or state legal holiday, validity runs to midnight of the next business day.

2. Extending validity

BIS considers longer validity case by case when extenuating circumstances warrant it (15 CFR 750.7(g)(1)). Requests may be made with the application or while the license is still valid. BIS will not approve changes to other aspects, such as the parties or the countries of ultimate destination.

Extensions are generally granted for multi-year projects and where the period matches a manufacturing license agreement, technical assistance agreement, warehouse and distribution agreement, or a license under the International Traffic in Arms Regulations. They are also granted where production lead time prevents shipment within the original period, or an unforeseen emergency prevents shipment within four years.

The request is a letter titled “Request for Validity Period Extension” (15 CFR 750.7(g)(2)(i)). It gives the requester’s name, address and telephone number, a copy of the original license with its number, validation date and current expiration date legible and a justification. The applicant ensures that all support documents remain valid and in its possession, and BIS responds in writing if it approves (15 CFR 750.7(g)(2)(ii)).

3. Barred persons and special licenses

Some people may not apply at all (15 CFR 750.7(e)). A person convicted under a statute specified in section 11(h) of the Export Administration Act may be barred from applying for any license for up to 10 years from conviction, at the discretion of the Secretary of Commerce. The section points to section 766.25 of the EAR for how the bar works (15 CFR 750.7(e)). If a licensee decides not to return items temporarily exported, it must apply for authorization to dispose of them. Unless the items will be used temporarily at a new destination and then returned, the application carries all documents a direct export to the new destination would need (15 CFR 750.7(h)(1)).

Some intransit shipments through the United States do not qualify for the intransit provisions of License Exception TMP, the exception for temporary exports, reexports and transfers (15 CFR 750.7(h)(2)). A license for such a shipment is valid only for a shipment wholly of foreign origin with an outstanding Transportation and Exportation or Immediate Exportation customs entry (15 CFR 750.7(h)(2)). Where a license authorizes transit through a country covered by General Prohibition Eight and the intermediate consignee was unknown, the licensee notifies BIS in writing once it is identified (15 CFR 750.7(h)(3)). A licensee with a replacement license keeps both the original and the replacement (15 CFR 750.7(h)(4)).

4. When license conditions end

Exporters, reexporters and foreign consignees are no longer bound by license conditions once the licensed items become eligible for a License Exception or need no license (15 CFR 750.7(i)). Items eligible for a License Exception follow that exception’s terms and the general restrictions. Items that no longer need a license remain subject to the EAR. Ending the conditions does not relieve an exporter or reexporter of responsibility for earlier violations. Licensees keep the license, used or unused, valid or expired, with all supporting documents and shipping records (15 CFR 750.7(j)).

5. Revocation and suspension

All licenses are subject to revision, suspension or revocation, in whole or in part, without notice (15 CFR 750.8(a)). BIS’s Office of Exporter Services may revoke any license in which a person convicted under a statute specified in section 11(h) had an interest at the time of conviction. BIS may need to stop a shipment or transaction at any stage, and to order the return or unloading of a shipment en route at any port of call. A licensee whose license is revoked or suspended keeps all supporting documents and shipment records (15 CFR 750.8(b)).

6. Duplicates and transfers

A licensee authorized to file on paper may get a duplicate of a lost, stolen or destroyed license by letter, certifying the loss and its circumstances (15 CFR 750.9(a)). BIS automatically issues a duplicate labeled for the Hong Kong Trade Department when a Hong Kong party is the intermediate consignee or Hong Kong is the reexport origin (15 CFR 750.9(b)). The duplicate goes to the reexporter or intermediate consignee, and the licensee keeps the original.

A license to export may not be transferred without BIS’s prior written approval (15 CFR 750.10(a)). The transferee must be subject to U.S. jurisdiction, be a principal party in interest and assume all responsibility for controlling the shipment. BIS approves only one transfer of the same license, and only for export licenses.

The licensee’s letter gives the reasons and facts, the licenses and pending applications concerned, the transferee, whether consideration is paid and the legal document behind the change (15 CFR 750.10(b)(1)). The transferee’s signed letter confirms its status and jurisdiction, accepts the license responsibilities and certifies recordkeeping (15 CFR 750.10(b)(2)). The licensee keeps the licenses until BIS acts (15 CFR 750.10(c)).

7. Shipping tolerances

A shipping tolerance lets a licensee export more than the value shown on a license (15 CFR 750.11). Once the full approved quantity has shipped, no tolerance applies and no further shipment may be made (15 CFR 750.11(a)). Until then, total value may exceed the license value by up to 10%, unless the license sets a specific tolerance or short supply rules set a different one (15 CFR 750.11(b)). What the license covers is set out in what an export license authorizes.

Key terms

Validity period	Generally four years, with shorter periods for some licenses.
Emergency license	A license that expires by the end of the following month.
Terminating conditions	The release of conditions once a license is no longer needed.
License transfer	A one-time, approved move of an export license to a new party.
Duplicate for Hong Kong	A copy BIS issues automatically for the Hong Kong Trade Department.
Shipping tolerance	The allowance of up to 10% above the licensed value.

Every statement above links to the document behind it. The full source list for this piece is on the sources page.

This page describes public United States government programs for general information. It is not legal, regulatory or procurement advice, and it does not address the facts of any particular case.

How Sentfore supports this

Keeping licenses current keeps shipments moving. Sentfore works at the delivery end of defense programs in difficult environments, providing secure movement, protective security, facilities and life support. Requirements can be sent through the contact page.