You Must Know Your End User: BIS Has Taken Out the Guesswork

First, let me say that having practiced business and Federal law for the past 20 plus years, selling to the wrong person or company by accident can have dire consequences. You need not worry about who you cannot sell to, especially as a?US based company.

The Bureau of Industry and Security (BIS) maintains a "Red Flag" list as part of its compliance guidelines to help businesses identify potential warning signs and perform enhanced due diligence when dealing with customers, partners, or transactions that might raise concerns related to export compliance and potential violations of Export Administration Regulations (EAR). The Red Flag list is a tool to help companies assess the risk associated with certain transactions and entities. It aims to prevent the unwitting involvement in activities that could breach export controls or support unauthorized end uses or end users.

The Red Flag list typically includes indicators or circumstances that might signal an increased risk of diversion or misuse of controlled items, technologies, or services. These indicators could encompass a range of factors, such as unusual order requests, discrepancies in information provided, changes in shipping destinations, and involvement with countries subject to sanctions or embargoes.

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