Question #1: when a technical assistance agreement (TA) expires, can foreign parties continue to use and exchange technical data previously authorized for export between the same signatories, under-licensed and end-users? The agreements under the International Traffic in Arms Regulations (“ITAR”) serve as a licensing tool for the transfer of defence, technical data, manufacturing know-how and defence services between a U.S. and a foreign party. Compliance with the requirements of these agreements is an important element of ITAR compliance, as evidenced by the most important recent approval agreement of L3Harris Technologies, Inc. (“L3Harris” or “The Enterprise”) with the U.S. State Department(“State” Directorate of Defense Trade Controls (DDTC). It is important that DDTC enter into an approval agreement with L3Harris in the fall of 2019 for alleged violations of the Arms Export Control Act (“AECA”) and ITAR. One of the 131 alleged ITAR offences contained in the proposed royalty letter was “violation of licence conditions and agreements.”  In particular, the company breached the terms and conditions of the TAAs and GWGs by not submitting: 1) the first export reports;  2) of the agreements reached;  3) annual status declarations;  4) a written statement on the agreements reached;  and 5) annual sales reports;  not only the non-disclosure by DDTC of unsigned agreements.  Distribution Agreement This type of license is an agreement for the creation of a warehouse or overseas outlet for defense products exported from the U.S. distribution must be located within an authorized sales area. The FAQs also discuss the ongoing distribution and distribution of ITAR-controlled defence items at the expiry of an applicable GWG or AA TAA. In this regard, the FAQs have made a more sensitive point on the subject discussed above, namely that domain restrictions in an expired agreement apply even after expiry. Among other things, parties that are not authorized under the expired contract cannot be associated with the expiry.
However, the FAQs state that defence items manufactured as part of a GW or AAT that has expired since then “may be transferred between the same foreign signatories and sub-licenses and for the same end-users and end-uses that have been previously authorized under the TAA or GWG.”