What Is a Deemed Export?
A deemed export occurs when controlled technology or source code is released to a foreign national within the United States. Under the EAR (§734.13), any release of technology or source code subject to the EAR to a foreign national is "deemed" to be an export to the foreign national's most recent country of citizenship or permanent residency. This means that even though no item physically leaves the country, the release of controlled information may require an export license.
ITAR has an even broader concept: any disclosure of technical data or defense services to a foreign person, anywhere in the world, constitutes an export or reexport requiring authorization from DDTC.
Common Deemed Export Scenarios
Deemed exports arise frequently in everyday business operations. Hiring a foreign national engineer who will work with controlled technology triggers the deemed export rule. Giving a plant tour to a foreign visitor where controlled equipment is visible may constitute a deemed export. Sharing technical specifications in a joint venture meeting with foreign partners requires analysis. Even university research with foreign graduate students can implicate deemed export controls.
Determining If a License Is Needed
First, determine if the technology or source code being shared is controlled under an ECCN. If it is EAR99 or falls under a fundamental research exclusion, no deemed export license is needed. If the technology is controlled, check whether the foreign national's country of citizenship would require a license using the Commerce Country Chart. Apply any available license exceptions, such as TMP or fundamental research exclusions for academic institutions.
Technology Control Plans
Organizations handling controlled technology should implement a Technology Control Plan (TCP) that identifies all controlled technology within the organization, screens foreign national employees against restricted party lists, implements access controls (physical and electronic), provides training on deemed export requirements, and maintains records of all foreign national access authorizations.