“From what I have heard, we might have a health care reform bill before we pass a new EAA.” 
Believe it or not, these words are not ripped from today’s headlines, but from the opening statement of Senator Patty Murray (D-WA) during a 1994 Congressional hearing on amendments to the Export Administration Act. Still a sign of the times, the Senator noted two key goals of any real export control reform:
“Real reform means eliminating the maze and the red tape of export licensing. It means telling our exporters in plain English exactly what is controlled and why.” 
Eliminating the maze and red tape of licensing and adding terms exporters can understand equates to the need for simplicity, a reform goal reiterated more recently by Former Secretary of Defense Robert Gates in a 2010 speech before business executives in Washington D.C. where he described the U.S. export controls system as a “bureaucratically labyrinthine system” and a “byzantine amalgam of authorities, roles, and missions scattered around different parts of the federal government.” 
Despite the need for simplicity, each administration looking to reform the U.S. export control system has increased the overall complexity of the system. So far, the Obama administration’s approach under the President’s Export Control Reform (“ECR”) Initiative is no different.
ECR is Not About Simplicity
As described in previous DTL posts, the ECR Task Force has created complex new terms, overlapping agency jurisdiction, new Congressional notification requirements, a new interagency review process, new internal agency entities, an EAR 600 series see-through rule, and other complexities inherent in aligning the Department of State and Department of Commerce export control lists.
Paramount among the new terms is the Task Force’s creation of new definitions for “specially designed” in the Department of Commerce’s Export Administration Regulations (“EAR”) and Department of State’s International Traffic in Arms Regulations (“ITAR”).
Prior to ECR, specially designed was already used in EAR control listings for items controlled by the Missile Technology Control Regime (“MTCR”) and the Wassenaar Arrangement. The new ECR definitions for specially designed differ from the MTCR definition and from Wassenaar member understandings of the term. Among other things, these differences create disconnects between the new ECR definitions and certain preexisting missile technology controls that use a different definition of the same term and Wassenaar encryption controls that use the term.
Nevertheless, where the new ECR definitions for specially designed apply, they are long, multi-staged, and subject to varying interpretations. Agency guidance on use of the new definitions is spread throughout federal register notices, online decision tools, conference presentations, and speeches by senior agency officials. Even if successful in putting these pieces of the regulatory puzzle together, companies still face risks of error in self-determining jurisdiction and classification because the majority of agency guidance is nonbinding and subject to change.
Adding to the complexity, industry requests for official guidance on whether an item is caught by a control list entry using specially designed must be submitted through an entirely new interagency review process created by the ECR Task Force for that purpose. 
Senior agency officials may argue that the new specially designed definition and other added twists, turns, and red tape being created by ECR will be justified when they deliver on the promise of a single control list and single licensing agency. However, regardless of whether the ECR Task Force eventually establishes these singularities, it seems that the new complexities being added by the ECR will be the subject of industry confusion and varying agency interpretations for years to come.
Continued Need for Simplicity
Many key terms in the EAR and ITAR were far from plain English before the start of ECR. Definitions for “Technology,” “Use,” and many other terms have been complex and multilayered for years, with frequent cross-references to other terms defined outside common usage. As was further noted in a prior DTL post, some of this complexity is an unavoidable consequence of balancing the need for simplicity with the desire not to control too much. In other words, and as described by the Ninth Circuit in U.S. v. Zhi Yong Guo, 634 F.3d 1119 (2011), the problem is that export control regulations are complicated by the very nature of what they regulate.
Nevertheless, while large companies can afford counsel and full-time staff to wade through the hundreds of pages of complex regulations, many small companies cannot. For these stakeholders, simplification of the regulations, even at the cost of increased need for advanced agency review and approval, is preferable to the uncertainty and risks of getting it wrong. In addition to providing fair notice of what’s required, simplicity can also reduce agency review time and increase effectiveness in stopping exports against national security interests. This is why, as noted by Senator Murray nearly twenty years ago, simplicity must be the hallmark of any real reform.
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[F/N 1] The Export Administration Act of 1994: Amending the Export Administration Act to Bring Existing Controls More into Line with Today’s Political and Economic Realities, Hearing before the International Finance and Monetary Policy of the Committee on Housing, Banking and Urban Affairs, United States Senate, 103th Cong., 2nd Sess. (1994) p. 3.
[F/N 2] Ibid.
[F/N 3] Remarks as Delivered by Secretary of Defense Robert M. Gates delivered to Business Executives for National Security (Export Control Reform), Ronald Reagan Building and International Trade Center, Washington DC, Tuesday, April 20, 2010.
[F/N 4] See e.g., new 15 C.F.R. Sec. 748.3(e)
* The above is not intended as an exhaustive list of restrictions that may apply to a particular transaction nor advice for a specific transaction because the specifics of an individual case may implicate application of other U.S. laws as well as foreign laws that carry added or different requirements. In addition, U.S. export control and sanctions laws are frequently subject to change. Such changes can affect the continued validity of the information above, which is based on U.S. law existing as of November 29, 2013. For these reasons, assistance from a qualified attorney competent to advise on such matters is highly recommended.
Matthew A. Goldstein is an International Trade Attorney in Washington D.C. licensed to practice in the District of Columbia. He can be reached at (202) 550-0040 and Matthew@GoldsteinPLLC.com.