Pittsburg, PA

Tucker Arensberg, P.C.
Tucker Arensberg, P.C.
One PPG Place, Suite 1500
Pittsburgh, PA 15222
(412) 566-1212
(412) 594-5619
Directions to Pittsburgh

Harrisburg, PA

Tucker Arensberg, P.C.
Tucker Arensberg, P.C.
300 Corporate Center Drive, Suite 200
Camp Hill, PA 17011
(717) 234-4121
(717) 232-6802
Directions to Harrisburg

New York, NY

Tucker Arensberg, P.C.
Tucker Arensberg, P.C.
250 Park Avenue, Suite 1508, 7th Floor
New York, NY 10171
(212) 739-7910
(212) 739-9607
Directions to New York

Foster City, CA

Tucker Arensberg, P.C.
Tucker Arensberg, P.C.
1098 Foster City Boulevard, Suite 106 #700
Foster City, California 94404
(650)208-2701
Directions to Foster City

Widget Title

  • People
  • Practice Areas
  • News + Insights
    • News
    • Articles
    • Speaking
  • Office Locations
    • Pittsburgh
    • Harrisburg
    • New York
    • Foster City
  • About the Firm
    • Overview
    • Careers
    • Diversity
    • Women@Tucker
    • Affiliations
    • Pro Bono & Community

Title

  • Skip to primary navigation
  • Skip to content
  • Skip to primary sidebar

Tucker Arensberg, P.C.Tucker Arensberg, P.C.

Attorneys in Pittsburgh, Harrisburg, New York City

  • People
  • Practice Areas
  • News + Insights
  • About Our Firm
  • COVID 19: Answers to Business Challenges
ShareBookmarkPDF

Review of Export Control Issues is Necessary Due Diligence

Articles January 16, 2019

Successful mergers and acquisitions require a substantial amount of due diligence.  Before committing to the transaction, the buyer needs to understand the obligations and risks that will be assumed.  One area that is frequently overlooked is the selling company’s export control exposure.  The results can be devastating for both the seller and the buyer if export control compliance is not taken into account.

For example, an aerospace and defense technology company was hit with $20 million dollars in civil penalties for its failure to oversee the actions of various subsidiaries.  In that case, at least two subsidiary companies illegally transferred technical data to foreign nationals.  In one of those cases, the illegal transfers occurred over a period of thirteen years. The State Department concluded that the violations occurred because of inadequate corporate oversight and record-keeping, both of which require the existence of a robust export control program.

Export control liability should be factored into the due diligence process.  At the very least, a buyer should know the answers to the following questions before making the deal:

  • Does the selling company manufacture products listed on either the U.S. Munitions List or Commerce Control List?
  • Does the selling company have foreign customers? If so, where?
  • Does the selling company deal with re-exports or foreign based products that incorporate U.S. parts or technology?
  • Does the selling company make informational exports via training or seminars abroad?
  • Does the selling company’s employment of foreign nationals require an export license or the adoption of appropriate screening measures?
  • What sort of export controls, if any, does the selling company have in place?
  • Is the selling company registered with the Directorate of Defense Trade Controls?
  • Does the selling company have any existing export licenses? (Note: licenses cannot simply be assigned to a buyer without government approval)

When it comes to export controls, an ounce of prevention is truly worth a pound of cure.  Do not overlook this critical due diligence issue during your next M & A deal.

For additional information contact Mark Hamilton.

Primary Sidebar

Review of Export Control Issues is Necessary Due Diligence

Related

People

  • Mark C. Hamilton

Practice Areas

  • Import/Export Control & Compliance
  • Mergers & Acquisitions
© 2023 All Rights Reserved|Tucker Arensberg, P.C.|Log in|Powered by Content Pilot
  • Sitemap
  • Disclaimer
  • Privacy Policy