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EU: Agreement on dual-use goods and technologies

EU: Agreement on dual-use goods and technologies

The European Commission today issued a release after an agreement was reached by the European Parliament and the EU Council on a proposal for modernization of EU export controls on sensitive dual-use goods and technologies.

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As noted in today’s EC release, the changes are expected to upgrade and strengthen the EU's export control toolbox to respond effectively to evolving security risks and emerging technologies. Under the new measures, the EU will be able to “effectively protect its interests and values and, in particular, address the risk of violations of human rights associated with trade in cyber-surveillance technologies without prior agreement at multilateral level.”  

This new regime will provide a new basis for the coordination of controls of a broader range of emerging dual-use technologies between the EC and the EU Member States in support of the effective enforcement of controls throughout the EU. Due diligence obligations and compliance requirements for exporters have also been introduced, in response to the risks posed by trade in dual-use items to international security.

The new regime will provide “a strong basis” for the EU to engage with third countries in order to support a global level-playing field and enhance international security through more convergent approaches to export controls at global level.

Background

The EC in September 2016 adopted its legislative proposal to modernize EU controls on exports of sensitive dual-use goods and technology—these are items that may have many civilian uses but can also be used for defense, intelligence, and law enforcement purposes (such as nuclear and special materials; and telecommunication, electronics and computers, space and aerospace, and marine equipment).

The new regime includes many of the EC’s proposals for a comprehensive “system upgrade” and is expected to make the existing EU export control system more effective by:

  • Introducing 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 harmonising licensing procedures and allowing the EC to amend—by “simplified” procedure or a 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 EC 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 program for EU Member States and their 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 EC group of EU Member States experts
  • Setting up a dialogue with third countries and seeking a level playing field at global level


For more information on this topic or to learn more about KPMG’s Trade & Customs Services, contact:

Doug Zuvich
Partner and Global Practice Leader
T: 312-665-1022
E: dzuvich@kpmg.com

John L. McLoughlin
Principal and East Coast Leader
T: 267-256-2614
E: jlmcloughlin@kpmg.com

Andy Siciliano
Partner and National Practice Leader
T: 631-425-6057
E: asiciliano@kpmg.com

Steve Brotherton
Principal and Global Export and Sanctions Leader
T: 415-963-7861
E: sbrotherton@kpmg.com

Luis (Lou) Abad
Principal, Washington National Tax
T: 212-954-3094
E: labad@kpmg.com

Irina Vaysfeld
Principal
T: 212-872-2973
E: ivaysfeld@kpmg.com

Amie Ahanchian
Principal
T: 202-533-3247
E: aahanchian@kpmg.com

Christopher Young
Principal
T: 312-665-3229
E: christopheryoung@kpmg.com

Gisele Belotto
Managing Director
T: 305-913-2779
E: gbelotto@kpmg.com

George Zaharatos
Principal
T: 404-222-3292
E: gzaharatos@kpmg.com

Andy Doornaert
Managing Director
T: 313-230-3080
E: adoornaert@kpmg.com

Jessica Libby
Managing Director
T: 612-305-5533
E: jlibby@kpmg.com

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