The EU Commission has recently announced several significant changes to the export control regime. Firstly, a new EU dual-use control list enters into force today and, secondly, the EU Commission has announced its intention to amend the EU export control regime. 

The EU control list contains a number of dual-use products subject to restrictions when exporting out of the EU territory. The new control list takes effect as of today. 

Danish companies exporting products out of the EU territory, and in some instances inside the EU territory, must ensure that the export is in compliance with the EU export control regime and the Danish rules on export control. Keeping up to date on these changes to the export control regime is important for exporting companies in order to avoid fines, violation of contractual obligations, potential liability and reputational risks. 

The EU Dual-Use Export Control Regime │ Overview 

The EU export control regime derives from international commitments to counter the proliferation of nuclear, biological and chemical weapons as well as items with potential military end-use. The current EU export control regime is mainly governed by Regulation no. 428/2009 (the “Dual-Use Regulation”), which provides for common EU control rules, a common EU list of dual-use products as well as coordination and cooperation to support consistent implementation and enforcement throughout the EU member states.

Under the EU export control regime export of certain dual-use products outside the EU territory requires prior authorisation. Products subject to this requirement are primarily: 

  • All products listed on the control list (Annex I to the Dual-Use Regulation) in force at the time of the export. Please see the current control list here
  • Products which are, or may be intended in their entirety or in part, for use in connection with weapons of mass destruction programmes (e.g. chemical, biological or nuclear weapons) or in violation of an international arms embargo (the “catch-all” provisions). 
  • Any products subject to nationally imposed restrictions.

Further, certain restrictions apply to services related to dual-use products, including brokering services, transport and technical assistance.

Annex IV to the Dual-Use Regulation is an excerpt from Annex I, and lists the most critical dual-use items which are subject to the strictest controls. A prior authorisation is always required when exporting items listed in Annex IV, even if it is a matter of intra-EU exports. 

The Danish Business Authority is the relevant authority in Denmark for issuing export authorisations regarding dual-use products. Further information on export authorisations can be found here

Modernisation of the Export Control Regime │ New Control List 

The new control list, which enters into force today, includes developments in international export control regimes since the previous update on 12 October 2015 (Regulation (EU) No 2015/2420) with minor corrections to the regulation having been made on 12 February 2016 (Corrigendum to Commission Delegated Regulation (EU) 2015/2420). 

The regulation amending the control list (Regulation (EU) 2016/1969) presents a number of amendments to the technical definitions and descriptions and the removal or addition of dual-use products. Over 200 amendments have been made to the control list. The main changes include:

  • Updates of the control of laser measuring systems and a new control for electronic equipment that can perform high-speed analogue-to-digital conversions. 
  • Structural changes regarding Information Security in category 5 part 2 as well as removal of several controls, including those on aerospace/missile seals, hydraulic fluids and underwater cameras.
  • Several CAS (Chemical Abstracts Service) numbers have been added to the chemicals listed in category 1.
  • A new control for software for the operation and maintenance of guidance sets has been added to category 7, and moreover, gel propellant rocket motors have been added to the liquid rocket engine control in category 9. 
  • Addition of the chemical Diethylamine (109-89-7) to 1C350. 
  • Several viruses are renamed and the controls on biological equipment have been reviewed. Furthermore, two new viruses – SARS-related coronavirus and Reconstructed 1918 influenza virus – are added to the control list.

For the full overview of the amendments to the control list, please see the Comprehensive Change Note Summary 2016

Modernisation of the Export Control Regime │ New Regulation 

On 28 September 2016, the EU Commission published a proposal for a new regulation (COM (2016) 616 final) revising the EU regime for the control of exports, transfer, brokering, technical assistance and transit of dual-use items. 

The proposal consists mostly of amendments to existing provisions of the Dual-Use Regulation, but it also introduces new provisions on control of certain cyber-surveillance technology and rules on technical assistance. Further, brokering and transit controls are strengthened. 

The EU Commission finds it appropriate to control the export of cyber-surveillance technology in order to protect public security as well as public morals considering the indications that certain cyber-surveillance technology exported from the EU have been misused by persons complicit in or responsible for directing or committing serious violations of human rights or international humanitarian law in situations of armed conflict or internal repression.

Overall, the proposal also aims at simplifying the administration of controls and reducing the burden for exporters throughout the single market, for instance by further harmonising the licensing process, the scope of the catch-all controls, and introducing new general authorisations. An additional goal is to contribute to the protection of human rights globally – in particular the provisions on control of cyber-surveillance technologies, which will further aim to address the risks associated with digital trade.

It has not been announced when the regulation, if adopted, is expected to enter into force. The regulation was proposed by the EU Commission on 28 September 2016, and is now being discussed in the Council. 

Impact on Danish Companies

Danish companies are required to obtain an export authorisation before exporting products or services covered by the control list, the catch-all provisions or other national restrictions out of the EU territory. For certain critical products prior authorisation is also required for intra-EU exports. Furthermore, before an export authorisation is obtained, companies must not transport or provide any technical assistance in relation to these products, including e.g. repairs, development and maintenance, outside the EU territory. Breaches of the export control regime are punishable by fines or potentially imprisonment. 

Exporters are therefore advised to conduct an analysis of whether their export of products or services, or their existing processes relating to technical assistance, brokering or transportation or transfer of goods and services, will be effected by the new rules.