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ARTICLE · 26 APRIL 2024

Persistent Errors In The Export Classification Of Software Products

Torres Trade Law, PLLC
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Many companies, particularly Software-as-a-Service ("SaaS") and start-up companies, continue to struggle with the concept of export control classification of items with encryption functionality.

United StatesInternational Law
Olga Torres
Olga Torres
Derrick Kyle
Derrick Kyle
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Many companies, particularly Software-as-a-Service ("SaaS") and start-up companies, continue to struggle with the concept of export control classification of items with encryption functionality. This ongoing confusion is understandable for a few reasons. First, many SaaS companies do not export their software in the traditional sense. Software purchasing has moved beyond the days of downloading and installing software onto a computer from, for example, a CD-ROM. (Most newer laptops no longer contain disc drives.) But these companies may still unknowingly be exporting software according to regulatory definitions.

Second, many SaaS providers and other software developers are shocked that export controls, primarily applicable to military and "dual-use" items, have any relevance to seemingly innocuous software programs. But there are many commercial software programs that are classified under Export Control Classification Number ("ECCN") 5D002 (or 5A002 for related

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