The U.S. Department of Commerce published a redacted advisory opinion clarifying the application of the U.S. Export Administration Regulations (EAR) to non-U.S.-made products incorporating other non-U.S. products with U.S.-origin content. The advisory opinion constitutes the first written guidance permitting non-U.S. manufacturers to disregard U.S.-origin content incorporated by others into non-U.S. products that are, in turn, incorporated into their product. As a result, non-U.S. manufacturers may more easily apply the de minimis exemption from U.S. re-export control under the U.S. EAR. This article outlines the de minimis exemption from U.S. extraterritorial re-export controls, explains the application of the recent clarification of the so-called second incorporation principle, and provides examples of the application of the principle to non-U.S. made products.
Global Trade and Customs Journal