Recommendation on ICP in relation to dual-use restrictions

03/11/21

In the context of the amendment of the Dual-Use Regulation, the Commission's internal Coordination Group on Dual-Use Goods has been working on the revision of the existing Recommendation on compliance. This Recommendation has now been published in the Official Journal of the EU.

Main facts

The focus of the now published Recommendation is on research and development, since in this area there are often points of contact with restrictions regarding dual-use goods or technologies. This area of business must always be sensitized to the requirements of export control law.

The Recommendation offers companies, but especially research institutions, an orientation framework for the development or optimization of an effective internal compliance program (ICP). In addition, the Recommendation is also intended to put national authorities in a better position to decide on research-related export license applications for dual-use goods and technologies.

The main difference between the old (general) and the new (research and development-focused) Recommendation is that on some points it is much more detailed.

An introductory section aimed at persons from management has been added (Section 1).
The second section essentially highlights the special nature of tasks in research and development and the increased requirements for a functioning compliance system. Core elements of handling dual-use goods are also set out and explained here.
The third section, like the old recommendation, deals with the main features of an ICP within companies. However, the seven core elements of the ICP are described in more detail and with a focus on the R&D area. These seven core elements are:
1. Top management commitment to compliance
2. Organizational structure, responsibility and resources
3. Training and awareness
4. Export screening process and procedures
5. Performance review, audits, reporting and corrective actions
6. Record keeping and documentation
7. Physical security and information security
A new addition is the extensive appendices, which include diagrams, charts, notes, and questions to help build and overhaul an internal compliance program. Appendix 4 of the Recommendation provides a checklist for each of the aforementioned core elements, which you can use to review your existing or planned ICP.

For more information, visit the European Commission's site here.

What can this possibly mean for your company?

The Recommendation is to be understood as a uniform EU guideline for the internal and official implementation of dual-use regulations. While it is not binding, it provides a template in terms of content that will probably be implemented in most countries as part of service regulations or other service instructions.

Although the core of the current Recommendation is directed at companies in the research and development sector, the general principles can be applied by other companies as well and as such the export control measures can be adapted accordingly.

How can we help?

The Recommendation of the EU Commission has once again shown that a functioning ICP is essential for companies. Especially so in the research sector, for the companies to be compliant with legal dual-use regulations.

We would be happy to support you in setting up or optimizing your ICP.