Export Declaration The Ultimate FAQ Guide 2

Export Control Classification Number: The Ultimate FAQ Guide

Let’s look at some of the fundamental aspects of export control classification number.

So, if you want to learn more about ECCN, read this guide:

What Is An Export Control Classification Number (ECCN)?

Export Control Classification Numbers

Export Control Classification Number

An Export Control Classification Number is a number which is used by the Commercial Control List (CCL). The number consists of five numbers which include both numeric and alphabetical numerals

Also, the number helps classify exports and determine which exports require a license of commerce from the department of commerce.

The ECCN categorizes the exports into groups.

These are on the basis of the commodity, the software or the technology involved.

ECCN is divided into ten groups under the Commercial Control List.

Further divisions result to five product groups from the ten groups.

As a result, the first character of the ECCN describes the commodity in its broad prospective. While the second character identifies the product group.

Why Do I Need An ECCN Number?

Basically, an ECCN serves as a regulatory tool for which all exports must adhere too.

Aside from ensuring that the products are well categorized, ECCN numbers countercheck the need for licenses for the export goods.

What Is An Example Of ECCN?

First and foremost, the 10 groups used in classification are;

  • Nuclear and Miscellaneous
  • Materials, Chemicals, Microorganisms and Toxins
  • Materials processing
  • Electronics
  • Computers
  • Telecommunication and Information Security
  • Sensors and lasers
  • Navigation and Avionics
  • Marine
  • Aerospace and propulsion

The above categories form the Commercial Control List (CCL). For the product grouping, it is subdivided into five with alphabets.

These are;

  1. Systems, Equipment and Components
  2. Test, Inspection and Production Equipment
  3. Material
  4. Software
  5. Technology

These groupings allow for easier identifications of exports. For example, an export with the ECCN number 4E001 postulates that the exports consist of Computers in relation with the Commercial Control list.

E categorizes the export product in the technology line of product.

Where Is An ECCN Number Necessary?

An ECCN is necessary to determine the need for licensing of an export product. A license depends on the mandates put forth by the country receiving the goods.

There are three levels of control in export for the products. The end user, end use and end use of the product.

This means that the exporting country may not be in need of a license. However, the end user term in the country of export may require a license for the end user.

The ECCN number thus helps to decipher the terms for export and determine need for a license.

Additionally, manufacturers are aware of licensing need owing to the fact that they have numerous handlings of the same product.

Therefore, manufactures apply the ECCN number to help their clients to easily be informed of the need for licensing to their products.

Manufacturers indicate this on the description box for the cargo. The description box has a ‘Reason for control’ part where manufacturers put an x to indicate need for licensing.

To be able to do these manufacturers apply the knowledge of the ECCN numbers as used in previous exports that required a license.

Do Export Licensing Requirements Change Depending On Method Of Shipment?

No, licensing option only differ depending on the classification of the product. The classification depends on guidelines from the Export Administration Regulation EAR.

There are products which are not liable to a license while for other it is mandatory for them to have licenses.

Nonetheless, the mentioned classifications are subject to review by the office of export compliance.

Therefore, method of shipment does not affect the licensing process. It does not matter whether it’s through online shipment or the physical shipment process.

The product is the one to either qualify or dismiss the licensing.

What Is The Difference Between ECCN Code And HTS Code?

Both the ECCN and the HTS Code are used in product classification. However, the HTS code is a 10-digit code used in determining custom tariff classifications for commodities.

Sample of HST Code

HTS CODE

The ECCN code consists of only 5 alphanumeric characters that help in the classification process.

ECCN CODE

ECCN CODE

What Is ECCN Code Format?

The ECCN follows a certain format universal to all ECCN numbers. This includes the application of both numbers and alphabets in determining an ECCN code.

First and foremost, the ECCN number begins with numbers ranging from 0 to 10.  These numbers categorize the shipment for easier identification.

The category represents the Commercial Control List as earlier outlined.

The second character is an alphabet that indicates further the product group of your merchandise. These alphabets are only five, thus from A to E, as earlier outlined.

In total, the ECCN code consists of five characters. The last three numbers illustrate the reason for control for the shipment.

How Do I Classify My Products For Export Controls?

There are three ways in which you can use to classify your products.

You can choose to classify individually, or use the BIS or rely on a product vendor.

It is part and parcel of the Commerce department, hence can be used to help classify export products.

The following are the three main ways to classify product for export control explained.

Self-classification Method

From the name, you can classify your export product individually.

This means that you will have to source for the ECCN codes in the CCL as well as identify the product group for your export.

As a result, you have to be fully aware of the type of product you are exporting. Additionally, an extensive knowledge on the format and structure of the CCL list is an added advantage.

Sending The BIS A Request For Classification

This can be achieved through an online process. This is an online system that allows you to submit a request for the classification of your goods.

However, there is a certain requirement before accessing the system. The company in charge provides an identification from the company known as the CIN, which allows you to assess the system in order to submit the request.

Rely On Vendor

The manufacturer of the product sometimes is best suit to understand the nature of the product. Additionally, sometimes the manufacturer`s knowledge on the product can easily avail you with the ECCN details.

However, you are also required to make an effort to ascertain the ECCN provided.

As much as the vendors are acquainted with the commodity, any mishaps on the ECCN identification falls back on you, not the exporter.

Ensure your ECCN code is up to date with the current codes and your findings are in line with the vendor’s suggestion.

What Is The Difference Between Schedule B And ECCN Number?

ECCN Vs Schedule B

ECCN Vs Schedule B

As earlier outlined, ECCN code is used to classify export products according in relation to the CCL list and product groups.

Schedule B codes on the other hand help to track trade statistics.  The codes help to categorize exports meant for other countries.

Unlike the ECCN code, Schedule B is a 10-digit code.  The US Commerce department, Census Bureau and the Foreign Trade Division makes use of the Schedule B especially in publishing the US export statistics.

How Do I Find An ECCN Number?

There are four ways which you can use to find an ECCN number.

First of all, you can choose to just look for the code yourself.  This means you get to familiarize with the CCL list and work your way through the product list as well.

Another easier way is to consult with the manufacturer of the product. Chances are high that the manufacturer has the ECCN number of the product owing to the numerous times handling the same product.

You could also choose to use the Electronic system for item classification. This is an online platform designed to help you find the ECCN number.

However, you will have to be registered and given a PIN that allows you access to the site

Lastly, you could reach out to the BIS and request for the commodity classification for your good. You will thus need to fill the BIS-784P then proceed to make the request.

However, make sure to make earlier arrangements as the process takes 3 to 4 weeks to finalize.

Are There Any Requirements For Product Classification Requests?

Yes, first and foremost you should adhere to the maximum number of request outlined. Thereafter, provide all the necessary information that can aid in classifying your item

This may include attaching brochures and extensive specifications to describe your item

The BIS-784 form helps to disclose the information required to help in the classification process. Ensure to fill it appropriately.

Once you have fully exhausted describing your item, ensure to sign and correctly submit for classification.

If you are using online request services, ensure you have the pin number to access the website for classification

What is A Commercial Control List?

Commercial Control LIST

commercial Control List

A commercial control list from the name, is a list that outlays the categories for items and further divulges details on the need for a license for the particular items.

What Happens If My Product Is Not On The Commercial Control List?

The product is then listed as EAR99. It is very common as a majority of products are usually not on the CCL list.

Moreover, these goods do not require any licensing procedures. However, this is not the case if your EAR99 is being exported to a certified country, or has proscriptions on the end-use of the item.

In this case a license is mandatory.

Do Commerce Control List (CCL) and ECCNs Change Often?

Yes, the CCL and ECCN s do change over time. As a result, it is important to be aware of the current CCL and ECCN codes.

The commerce department makes changes to the CCL list by removing or even adding products to the list. Additionally, the technical characteristics to items also change.

To be up to date, subscribe to email notifications to help you stay up to date.

Moreover, you could always make visits to the website to double check your ECCNs authenticity and acceptability.

What Is The Difference Between EAR99 And NLR?

EAR99 is for item classification which is assigned to products which are not found in the CCL list.

NLR means no license required. It is used in shipment classification.

EAR99 items mostly fall under items with NLR.

Additionally, there are items in the CCL list that also do not require a license.

Moreover, an EAR99 can also be subject to a license if the item is exported to a country.

It whoever restricts the use of the item, or end-user of concern, or supports a barred end-use.

Is ECCN Number EAR99 A Free Pass For Export Compliance?

No, EAR99 is not a free pass for export compliance.

The EAR99 simply states the product classification is not on the CCL list. However, the item is still subject to authorization for shipment.

It has to undergo a check to determine the terms of transactions such as the need for licensing.

How Much Does ECCN Classification Service Cost?

The unit price used is the SKU. The SKU price depends on the volume of your products or items.

Also, the more the volume of items, the more the discount on the volume of your items which further translates to less costs.

What is ECCN Country Chart?

The ECCN country chart outlines the regulations for licensing for exports to various countries across the world. This is in line with the destination details and the information on reasons for control.

ECCN Country Chart.

ECCN Country Chart

The item follows the procedure of first identifying itself with the CCL list. Thereafter, based on the given information, you either obtain a license or refrain from moving forth with the export.

What Are The Next Steps After Determining My ECCN?

The next step is to find out whether your item requires a license.

This applies to shipments which have items prohibited to the end –user or end use in the country of export.

To determine license requirement for your item, check the `Reasons for Control`.

The ECCN entry provides this information.

Further cross check this information with Reasons for control to the country of destination. The Commerce Country chart helps with these details.

Afterwards, once you find an X in the box, be sure to obtain a license for your item.

What Does Prohibited End User Or End Use Mean In Relation To Export Control?

Prohibited end user which means the item being exported is under restrictions due to the harm it could cause to people.

As a result, such items are subject to licenses or rejection by the country of export. The EAR provides guidelines and restrictions in relation to end user and end use.

How Do I Screen Customers For Exports?

Screening customer for exports helps to easily identify prohibited products from individuals or countries restricted for exports.

Although there are documents that can identify these customers such as the Denied Persons List or Entity list to help with restrictions.

However, there is a website that intensively highlights prohibited exports and the countries. It is known as the consolidated screening list.

It is a much available search engine database.

The information in this site is from the Department of Commerce, State and Treasury.

Moreover, the BIS also provides a website you can use to obtain more information. It can be on the customers, and look out for customers to keep off from.

If I Need An Export License How Do, I Apply For One?

The growing technology has made it easier to acquire licenses. Visit the described online platform as outlined by the export department and fill in the requirements described.

Ensure to attach the following documents in the application;

  • Profile of exporter
  • Copy of the purchase order
  • Identification proof
  • Address proof
  • Bank certificate
  • Any other relevant documents requested by the site.

Is There A Fee For Submitting An Application For License Application To BIS?

No, sending a licensing application form is free, it does not attract any extra costs.

What Is A License Exception?

License Exception

License Exception

This is an approval that grants the permission to export and re-export items without the requirements of a license.

The EAR outlines the necessary conditions subject to a license exception for different goods.

Under the EAR the following exceptions to licensing occur;

LVS; These are items with limited value

GBS;  These items are controlled for national security reasons to specific countries.
CIV;  These items are controlled for national security reasons to particular countries where end-user is a citizen.
TSR; These are certain technology and software to certain countries.
APP; These entails computer exports.
KMI;  This encompasses encryption exemption for key management.
TMP;   It entails temporary exports, re-exports, or imports,

RPL;  Involves repair and replacement parts for items already in export.
GFT;   These are gifts and humanitarian donations.
GOV;   Entails exports to some government entities.
TSU;  Involves mass-market technology and software exports.
BAG;    These are baggage exemptions.
AVS;    Aircraft and vessels and most exports of spare parts associated with aircraft and vessels.
APR;    Permits re-export from approved countries.
ENC;  These are encryption devices and software.
AGR;   Agricultural commodities.
CCD;   Authorization of consumer communication devices to Cuba.

What Happens If I Don’t Get The Proper Export Authorization?

You are most likely to attract penalties and fee charges from the export control department. As a result, you are strictly mandated to follow the regulations put in place to evade such extra costs and inconveniences.

Additionally, if you are using a representative to handle your exports, ensure they are in line with the EAR regulations. Failure to which you solely attract punishments, regardless of using someone else to handle your shipment.

At BanSar, we will help you whenever you’re shipping from China.

We will handle all the freight forwarding services for you.

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