What Are License Exceptions?
License exceptions are provisions within the EAR that authorize exports or reexports of items that would otherwise require a license, without the need to apply for and receive a specific license from BIS. They are codified in Part 740 of the EAR and each has specific conditions, limitations, and recordkeeping requirements that must be met.
Using a license exception is not the same as an item being license-free. The exporter must verify that all conditions of the exception are met for each transaction, maintain records of the shipment citing the specific license exception used, and ensure that no general prohibitions (such as denied party restrictions) override the exception.
License Exception TMP (Temporary Exports)
TMP authorizes temporary exports and reexports of items for purposes such as servicing, exhibition, demonstration, or testing, provided the items will be returned to the United States within a specified time period (typically one year). TMP is commonly used by companies sending equipment abroad for trade shows, customer demonstrations, or repair/calibration at overseas facilities.
License Exception STA (Strategic Trade Authorization)
STA is one of the most widely used license exceptions. It authorizes exports and reexports to destinations listed in Country Group A:5 (36 allied countries) for most CCL items, and to Country Group A:6 (a subset of 8 closest allies) for certain higher-controlled items. STA requires an end-use statement from the consignee and has specific notification requirements.
License Exception GOV (Government Officials and Agencies)
GOV authorizes exports to personnel and agencies of the U.S. government, including items for official use by U.S. government departments and agencies operating abroad. This exception is frequently used by defense contractors and IT service providers supporting government operations overseas.
Choosing the Right Exception
The correct license exception depends on the ECCN, destination country, end-user, end-use, and specific conditions of the transaction. Always check the License Exception column in the Commerce Country Chart (Supplement No. 1 to Part 738) to verify which exceptions are available for your specific ECCN and destination combination.