track of the system. Small and medium-sized companies, both U.S. and foreign majority-owned, that lack the resources necessary to make sense of U.S. export laws often simply give up the effort to seek new international markets for U.S.-manufactured products.

Overlapping Enforcement

Domestically, overlapping jurisdiction and lack of communication between Customs and the Commerce Department Office of Export Enforcement have sometimes resulted in their working on the same case without each other's knowledge. The Export Administration Act, as amended, states that the Customs Service and the Commerce Department can conduct—separately or mutually—EAA-related investigations within the United States. At borders or ports of entry, the Commerce Department must give the Customs Service prior notice of its investigation. Outside the United States, the jurisdictional lines blur. Neither the Department of Commerce nor the Customs Service actually "investigates" overseas; rather, they coordinate with overseas law enforcement agencies to obtain evidence needed for U.S. domestic cases. Commerce enforcement agents must obtain Customs concurrence to travel abroad.

According to the Commerce Department's International Trade Administration, "to ensure their effective cooperation in export control, Commerce and Customs will routinely and promptly exchange licensing and enforcement information, including advising as to the opening and closing of investigations.15 Despite this guidance, the Customs Service and BXA's Office of Export Enforcement have not been able to establish an official, working mechanism to coordinate enforcement activities.

As for sanctions, the levels of sanctions for violations and the circumstances that must be established for their imposition vary from statute to statute. Sanctions have developed over the years through ad hoc legislation, and no effort has been made to assess and systemize them. A critical decision as an investigation progresses is whether to recommend criminal prosecution, civil penalties, or both. Depending on the nature of the violation, civil penalties might be a more effective deterrent than criminal prosecution and vice versa. There is, however, no agreed, interagency standard for cases that warrant criminal prosecution as opposed to cases that should be addressed through civil penalties. Moreover, consultation between Commerce and Customs on the appropriate action is limited.

In the administration of civil penalties, the Commerce Department makes use of an administrative law judge and judicial review.* Although the Arms


An issue in this procedure deserving further study is that the Commerce Department, which lacks the same degree of independence as an administrative law judge, has the power to modify the decisions of an administrative law judge.

The National Academies | 500 Fifth St. N.W. | Washington, D.C. 20001
Copyright © National Academy of Sciences. All rights reserved.
Terms of Use and Privacy Statement