A licence exception is an authorisation in Part 740 of the Export Administration Regulations (EAR) that lets you export without a licence when one would otherwise be required (most often because the Commerce Country Chart shows an X), provided the exception's conditions are met. Part 740 contains more than a dozen. Some depend on the ECCN (the list-based exceptions LVS, GBS, TSR and STA), and others depend on the type of transaction (TMP, RPL, GOV, BAG, ENC and more). None of them can be used where the general restrictions in § 740.2 apply.
Check the general restrictions in § 740.2 first
No exception can be used when the export is to a prohibited end user or end use under Part 744, to an embargoed destination beyond what Part 746 allows, or for certain items (for example some MT, NP and surreptitious-listening items). Check them before you choose an exception, as part of deciding when an export licence is required.
List-based licence exceptions (named in the ECCN)
Each ECCN's List Based License Exceptions section says which of these are available and sets any limits. Our guide on how to read an ECCN entry shows where that section is.
LVS: Limited Value Shipments (§ 740.3)
LVS covers shipments below the value limit stated in the entry, to Country Group B. Splitting shipments to stay under the limit is a misuse.
GBS: Group B Shipments (§ 740.4)
GBS covers items that the entry marks as eligible, to Country Group B.
License Exception TSR (§ 740.6)
TSR, Technology and Software under Restriction, covers certain technology and software to Country Group B. The recipient must give a written assurance.
STA: Strategic Trade Authorization (§ 740.20)
STA covers many items to Country Group A:5, and fewer to A:6, with notices and prior consignee statements. The guide to License Exceptions TMP, STA and GOV sets out its conditions.
Transaction-based licence exceptions
| Exception | EAR section | What it covers |
|---|---|---|
| TMP | § 740.9 | Temporary exports, such as tools of trade, exhibitions and repairs |
| RPL | § 740.10 | Servicing and replacement of parts for previously exported items |
| GOV | § 740.11 | U.S. government and certain foreign government end users |
| GFT | § 740.12 | Gift parcels and humanitarian donations |
| TSU | § 740.13 | Certain operation software, software updates, published or mass-market software |
| BAG | § 740.14 | Personal baggage, for example a traveller's own laptop |
| AVS | § 740.15 | Aircraft, vessels and spacecraft on temporary sojourn |
| APR | § 740.16 | Additional permissive reexports |
| ENC | § 740.17 | Encryption items (see License Exception ENC) |
| AGR | § 740.18 | Agricultural commodities to specified destinations |
| CCD | § 740.19 | Consumer communications devices to specified destinations |
Newer exceptions have been added for specific policies, for example for advanced computing items. Always check the current Part 740 on eCFR.
Which licence exception fits your situation?
| Situation | Exception to consider |
|---|---|
| Sending a demo unit to a trade show and bringing it back | TMP |
| Replacing a defective part under warranty | RPL |
| A low-value shipment of a controlled component to a Group B country | LVS, if the entry allows it |
| Controlled items to a close ally | STA, after checking eligibility and paperwork |
| An employee travelling with a company laptop | BAG, or TMP (tools of trade) |
| Encryption software to enterprise customers | ENC |
| Software updates for previously exported software | TSU |
How to choose an exception
- Confirm that a licence is actually required. If it is not, the export is NLR and needs no exception.
- Check § 740.2 and screen every party.
- Check the ECCN's list-based exceptions and their limits.
- Consider transaction-based exceptions that fit the situation.
- Read the exception's conditions in full, including destinations, values, assurances and reporting.
- Record the exception and the evidence that its conditions were met.
Common mistakes happen at steps 1, 2 and 5. Exporters use an exception when NLR applied (harmless, but confusing in the records), or claim NLR when an exception was needed. They miss the assurances or statements that TSR and STA require. And they forget that most exceptions do not cover restricted parties.
Documentation that supports an exception
For each export under an exception, keep:
- the classification, with the paragraph;
- the exception relied on, and why its conditions are met;
- any assurances, statements or notices the exception requires;
- the screening results;
- the export filing showing the exception code, usually the Electronic Export Information filed in AES.
An exception that cannot be shown to apply is, in practice, an unlicensed export. The records are what make the exception real. How long to keep them is covered in export recordkeeping under Part 762.
Licence exceptions in ECCN.help
After classification in the rule-based ECCN.help Classification Workflow, the ECCN.help licence exceptions view reads the entry's reasons for control and lists the exceptions the entry allows, with the conditions each one carries, drawn from the entry itself.
ECCN.help provides research and assistance, not legal advice. Verify every result against the regulation.