Arms regulations training available August 12

August 3, 2009
| By Pete Daly |
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Complying with the myriad details within federal export regulations — especially when the products or materials could be related to national security — can be a challenging process, but it just got easier and cheaper for Michigan exporters to get the information they need.

The Van Andel Global Trade Center at GVSU began offering training on International Traffic in Arms Regulations in June and will offer another session Aug. 12, this time in Auburn Hills. Representatives from about 40 Michigan companies came to the first training session in Grand Rapids June 5.

"We've been getting a flood of calls over the past year and a half, asking for local training," said Sonja Johnson, executive director of the VAGTC. "It's quite expensive if they have to travel far."

She said she is aware of ITAR compliance training in California that has a $1,000 registration fee — and, of course, travel expenses and time spent.

Non-members of the VAGTC pay $300 for the training here. Members pay $175.

Non-compliance with ITAR for any reason, deliberately or not, can be a costly mistake. In 2007, ITT Corp. of White Plains, N.Y., paid a $50 million fine after pleading guilty to one ITAR violation relating to improper handling of sensitive documents and another violation of making misleading statements. The company makes night vision goggles for the U.S. military and had illegally exported the technology to foreign countries. ITT Corp. is a high-tech engineering and manufacturing company operating worldwide in water and fluids management, global defense and security, and motion and flow control. The company had sales of $11.7 billion last year.

The training offered by VAGTC covers each step of the process to legally export "dual-use" items covered by ITAR.

"It's a long day," said Johnson, "but at end of the day, they actually know how to go through the process. They know what records they need to keep and how to register to comply."

Just the list of ITAR regulated items is daunting, and the regulations don't apply only to companies with government contracts, or that want to export actual military equipment to other countries. The operative word is "dual-use" — almost any civilian item that can also have a military application is considered dual-use and falls under ITAR regulations.

Johnson said infrared cameras, for example, are dual use because both the news media and military organizations around the world use them.

ITAR awareness is growing in West Michigan because many manufacturing companies that have relied on the auto industry are now seeking work in other types of industries, such as being a defense or aerospace contractor. But a company does not have to be considered a defense contractor to be subject to export rules under ITAR.

"Any company in general that's shipping an ITAR-related item" must comply, said Johnson. Many companies that supply the aerospace industry are subject to ITAR, she noted. In fact, Gavin Brown, president of the Michigan Aerospace Manufacturers Association, was invited to speak at the June ITAR training session because so much of what is manufactured for aircraft falls under ITAR rules.

However, even a product as seemingly innocuous as a pump can be subject to ITAR regulation.

Blackmer, formerly known as Blackmer Pump, is a 106-year-old Grand Rapids company that employs about 250 people at its plant near Burton Street and U.S. 131. Now owned by the $7.5 billion Dover Corp., Blackmer is one of the best-known American manufacturers of positive displacement pumps, centrifugal pumps and compressors for the transfer of liquid and gas products.

Blackmer has been a supplier of bronze pumps to the U.S. Navy for many years, although Linda Fagan said it is hardly considered a defense contractor because "this is a small part of our company." She has been with Blackmer 34 years and is manager of distributor administration, responsible for maintaining its export licenses. She took the ITAR training along with two other employees in June.

"I have dealt with (ITAR) for a few years so it was kind of like an update for me, in case there was anything new." Blackmer became a member of the VAGTC because of the ITAR training, Fagan said.

According to VAGTC, the compliance program is designed to inform and update the information held by corporations and individuals who are engaged in defense contractor activities or considering that activity. The day-long presentation covers the process for applying for a license, as well as topics such as "best practices when traveling and receiving foreign visitors," according to the VAGTC Web site.

Fagan said that means "you want to make sure when your foreign visitors come in (to your place of business), they're not snapping pictures, they're not taking back any kind of technology they're not supposed to take back. … We're talking about anything that might be classified," said Fagan.

Blackmer also makes high-alloy pumps that require two types of export licenses, one from ITAR and an EAR license, which stands for Export Administration Regulations. ITAR licenses come from the U.S. Department of State while an EAR is from the Bureau of Industry and Security, within the U.S. Department of Commerce.

Johnson said VAGTC worked closely with the Michigan Economic Development Corp. and the MEDC's Procurement Technical Assistance Centers in Michigan when the June training session was held. The PTACs support Michigan manufacturing companies seeking to become government contractors. Johnson said VAGTC wanted to make certain that the MEDC was aware of its resources for would-be exporters, "since we already have the training complete and deliverable."

The VAGTC, which has a variety of training sessions on different subjects, will take its training programs to a company that needs it if there are enough employees signed up for it.

VAGTC has provided various kinds of training for global trade "all over Michigan," said Johnson, and even outside Michigan at locations where Michigan companies have facilities.

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