LawFlash

New Documentary Requirements Issued for Hong Kong Exports and Reexports

March 22, 2017

Effective April 19, 2017, US exporters intending to export certain controlled items to Hong Kong will need to obtain, prior to shipment, either a copy of a Hong Kong import license or a statement issued by the Hong Kong government that an import license is not required.

The US Department of Commerce’s Bureau of Industry and Security (BIS) recently issued a Final Rule imposing new support document requirements with respect to exports to Hong Kong.

Exports to Hong Kong

Under the terms of the Final Rule, US exporters intending to export to Hong Kong any item subject to the Export Administration Regulations (EAR) that is controlled on the Commerce Control List (CCL) for national security (NS), missile technology (MT), nuclear nonproliferation (NP column 1), or chemical and biological weapons (CB) reasons must obtain—prior to shipment—a copy of a Hong Kong import license or, alternatively, a written statement issued by the Hong Kong government that an import license is not required. For purposes of the new requirement, a written statement issued by the Hong Kong government includes both a written communication to a license applicant informing the applicant that an item does not require a license and a statement available to the general public (e.g., on the Hong Kong Trade and Industry Department’s website) that a license is not required for the item.

The import license or written statement is still required even if the items for export are eligible to ship to Hong Kong under a license exception in the EAR.

Although the driving force behind Commerce’s new documentary requirement is the nature of the US export controls that apply to an export (NS, MT, NP, or CB), inquisitive exporters can find out whether items require Hong Kong import licenses by checking the control status of the items on the Hong Kong Trade and Industry Department’s Strategic Trade Controls website. If an item is not described on the website, exporters are advised by the BIS to seek confirmation from the Hong Kong Trade and Industry Department that the item does not require an import license.

Reexports from Hong Kong

The Final Rule also requires reexporters in Hong Kong that intend to reexport from Hong Kong to a third country items subject to the EAR and controlled on the CCL for NS, MT, NP column 1, or CB reasons to obtain, as necessary, not only US reexport licenses but also export licenses from the Hong Kong government authorizing export of such items from Hong Kong. If a Hong Kong license is issued, the reexport must comply with the terms of that license and be completed during its validity period.

Effective Date for Compliance

The new rule is effective April 19, 2017.

Compliance Tip for US Exporters

If your export to Hong Kong requires a US export license for NS, MT, NP column 1, or CB reasons, give your Hong Kong buyer sufficient advance notice to apply for and obtain the requisite Hong Kong import license—you will not be authorized to ship your products to Hong Kong until and unless your Hong Kong buyer provides you with the necessary import documentation.

Contacts

If you have any questions or would like more information on the issues discussed in this LawFlash, please contact any of the following Morgan Lewis lawyers:

Washington, DC
Margaret M. Gatti
Katelyn M. Hilferty