ITAR stands for International Traffic in Arms Regulations, which is a United States regulatory regime to restrict and control the export of defense and military-related technologies to safeguard U.S. national security and further U.S. foreign policy objectives. ITAR controls the manufacture, sale, and distribution of defense and space-related articles and services as defined. The regulations apply to all manufacturers, exporters, and brokers of defense articles, defense services, or related technical data, and they must be ITAR compliant.

ITAR’s rules can present a challenge for many US companies. For example, a US-based company with overseas operations is prohibited from sharing ITAR technical data with employees locally hired, unless they gain State Dept. authorization. The same principle applies when US companies work with non-US subcontractors. The State Department can issue exemptions to that one rule, and there are existing exemptions established for specific purposes. There are certain countries that currently have standing agreements with the U.S. that apply to ITAR – Australia, Canada, and the U.K., for example.

Noncompliance with ITAR can result in heavy fines along with significant brand and reputation damage, not to mention the potential loss of business to a compliant competitor. The penalties for ITAR infractions are stiff, including civil fines up to $500,000 per violation and criminal fines of up to $1 million and/or 10 years imprisonment per violation.

In summary, ITAR is a set of regulations that control the export and import of defense-related articles and services on the United States Munitions List (USML) to safeguard U.S. national security and further U.S. foreign policy objectives. Companies that manufacture, export, or broker defense articles, defense services, or related technical data must be ITAR compliant, and noncompliance can result in heavy fines and other penalties.