Houston partner David Ivey authored an article, "Foreign Employees: The Deemed Export Issue," which was published on June 3, 2010, by Law360.
According to Ivey, "It may come as a surprise that U.S. export control regulations apply to the employment of a non-U.S. citizen employee in the U.S. as well as abroad. A license may be required for the employee to have access to export controlled items, information, technology or software. If that is a surprise, then it may be a shock to learn that a license may also be required to share information with a foreign parent company, subsidiary, contractor or customer."
Ivey goes on to explain that "U.S. export regulations control the export of certain items, information, technologies and software. If something is export-controlled, then allowing the unlicensed access to it by a person who is not a U.S. citizen, or lawful permanent resident (“green card” holder), could be a violation of the regulations with the potential for very large fines and penalties. Extreme cases can also result in criminal prosecution. Under the regulations, exposure to an export controlled item, technology, information or software, is 'deemed' to be an export to the country of citizenship or nationality of the foreign person who has been allowed access."
Ivey explains the law and what it requires and concludes: "Effective compliance efforts start with identifying what, if any, controlled items, technology, information, or software a company has. From that starting point, a company can then began to assess whether a license will be required for foreign national access—whether by employees, consultants, foreign affiliates or customers."
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