The last ten years have seen a surge in the hiring of non-U.S. citizens by United States companies for a variety of positions involving technology, research, product development, and know-how innovation. Companies understand that hiring non-U.S. citizens implicates U.S. immigration and labor laws and requires that the newly-employed individuals obtain proper approvals authorizing them to work at U.S. companies’ designated facilities. Not quite as obvious, however, is the fact that the United States export laws also apply to the hiring of non-U.S. citizens (known under the export laws as "foreign nationals") and require that export authorizations be obtained before a foreign national can work for a U.S. company. This bulletin discusses, in general, the scope of U.S. export laws and the circumstances under which export licenses may be required prior to employing a foreign national, whether in a company’s U.S. or foreign facility.

United States export laws control the export of commodities, technology and information from the United States to foreign sources. The Departments of State, Commerce and Treasury authorize these exports under the Arms Export Control Act ("AECA"), the Export Administration Act ("EAA"), and the Trading with the Enemy Act ("TWEA"). These statutes combined control the export of almost all dual-use and defense-related commodities, technology and information.

These statutes are implemented by State, Commerce and Treasury through the International Traffic in Arms Regulations ("ITAR"), the Export Administration Regulations ("EAR"), the Foreign Asset Control Regulations ("FACR"), and the Bureau of Alcohol, Tobacco and Firearms Regulations ("BATFR"). The regulations establish a licensing procedure for obtaining export authorizations and generally define the limitations applicable to the transfer of products or information from the United States to foreign sources.

The export laws apply to the hiring of a foreign national because the laws and regulations broadly define "export" to include not only the physical transfer of a product to destinations outside United States borders, but also the disclosure or transfer (oral, written, or visual) of technical information to a foreign national, whether in the United States or abroad. Under these definitions, therefore, technical discussions between a U.S. citizen and a foreign national (whether conducted in the United States or abroad) are covered by U.S. export control laws. The implication of this statement is that these discussions may require an export license.

In conjunction with the broad definition of "export", the regulations also expansively define "technical data" to include information which is required for the design, development, production, manufacture, assembly, operation, repair, testing, maintenance, or modification of controlled products or technology. Technical data can also include "classified information," software, and information covered by an invention secrecy order under the United States patent laws. As a rule of thumb, technical data is usually considered to be information which one would not normally disclose to a competitor. Companies, therefore, should be fully aware of the extent to which non-U.S. citizens will be exposed to such competitively sensitive information.

The regulations require companies to submit export license applications or technical assistance agreements (with supporting technical documentation, job descriptions and scope of work) which must be approved, in writing, before the employee can begin working. The Departments of State, Commerce and Treasury permit the export of information to non-U.S. citizens and usually impose "provisos" (or limitations) to the scope of the license, in addition to the limitations enumerated in the regulations. For example, a U.S. company seeking to employ an Australian citizen to work on radar systems for civilian and military aircraft, would likely be granted an export license to allow the individual access to the necessary information, although the agency issuing the license would most often exclude specific U.S. Government strategic radar information from the scope of the license. Provisos impose an obligation on the company to ensure that the terms of the export license are not exceeded. This requires a monitoring or compliance program to ensure that neither the terms of the licenses nor the export laws are violated.

In hiring a foreign national, therefore, the initial export-related questions to ask include:

1. what tasks will the foreign national employee perform;
   
2. what type of technology or information will the foreign national employee be exposed to; and
   
3. are the foreign national employee’s activities covered under the U.S. export control laws?

Answers to these questions will determine whether an export license is needed before the employee can begin working. The growth in non-U.S. citizen employment coupled with an increase in the use, value, and need for information requires that companies be aware that export licenses may have to be obtained before they hire foreign nationals – whether as summer interns, graduate student temporaries, or full-time employees.