27 November 2020 - The European Parliament and the European Council recently reached an agreement on the European Commission's proposal to modernize the EU export controls on sensitive dual-use goods and technologies. According to the publication of the European Commission, this new rules allow for the EU, without prior agreement with other countries, to address the risk of human rights violations related to the trade in cyber-surveillance technologies and to effectively protect interests and values.
Already in September 2016, the European Commission adopted its legislative proposal to modernize the EU controls on exports of sensitive dual-use goods and technology. Sensitive dual goods and technology, in addition to their civil application, can also be used for defense, intelligence and law enforcement. Examples include nuclear and special equipment, telecommunications, electronics and computers, marine equipment, space and aerospace equipment.
Many of the European Commission's proposals from 2016, have been adopted into these new rules. As such, the comprehensive EU export controls upgrade will make the existing EU export control system more effective by:
- Introducing a notion of a ‘human security' dimension so the EU can respond to the challenges posed by emerging dual-use technologies, especially cyber-surveillance technologies, that pose a risk to national and international security, including protecting human rights;
- Updating key notions and definitions (e.g. definition of an “exporter” to apply to natural persons and researchers involved in dual-use technology transfers);
- Simplifying and harmonizing licensing procedures and allowing the Commission to amend – by ‘simplified' procedure, i.e. delegated act – the list of items or destinations subject to specific forms of control, thereby making the export control system more agile and able to evolve and adjust to circumstances;
- Enhancing information-exchange between licensing authorities and the Commission with a view to increasing transparency of licensing decisions;
- Coordination of, and support for, robust enforcement of controls, including enhancing secure electronic information-exchange between licensing and enforcement agencies;
- Developing an EU capacity-building and training programme for Member States' licensing and enforcement authorities;
- Outreach to industry and transparency with stakeholders, developing a structured relationship with the private sector through specific consultations of stakeholders by the relevant Commission group of Member States experts; and
- Setting up a dialogue with third countries and seeking a level playing field at global level.
Coordination within EU
This upgrade of the EU toolbox for export controls will allow that future security risks, emerging (sensitive) technologies and trade flows will be managed more effectively by strengthening the coordination of controls across the EU. Due diligence and compliance requirements for exporters, among other things, have been introduced and reports on issued licenses are required to be published to increase transparency. Finally, the Regulation provides a strong basis for the EU to promote cooperation with third countries for a global level playing field and international security by approaching more convergent export controls at the global level.
Impact to your business
If you are exporter, particularly related to sensitive dual-use goods and technologies, this means that these new additional compliance requirements will affect you. Are you engaged in, or intending to trade in dual-use items or want to know more about the new criteria for granting export licenses for dual-use items? The specialists of Mazars can help you comply with the new regulations.
Want to know more?
Do you require more information? Please contact Eline Polak by e-mail or by telephone: +31 (0)88 277 23 25 or Ellen van Heugten by e-mail or by telephone: +31 (0)88 277 12 45. They will be happy to help you.