Where Industry and Security Intersect
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BIS is publishing the Unverified List to notify exporters of the identity of certain unverified end-users (defined below) and to provide guidance with respect to "Red Flags" that are raised by transactions involving such persons.
This list identifies persons in foreign countries that were parties in past transactions for which an end-use visit (either a pre-license check or a post-shipment verification) could not be conducted for reasons outside the control of the U.S. Government.
The inability of the U.S. Government to establish the bona fides of a potential end-user of controlled U.S. goods through a pre-license check, or to ensure that the item exported is being used in accordance with U.S. export control regulations by a post-shipment verification, raises questions about the suitability of these end-users to receive U.S. origin items. Accordingly, BIS is notifying U.S. exporters to be vigilant before engaging in transactions involving such end- users.
"Red flags" are circumstances that warrant heightened scrutiny of the parties involved in a transaction (as described under the "Know Your Customer" guidance set forth in Supplement No. 3 to part 732 of the Export Administration Regulations.) Under that guidance, whenever there is a "Red Flag," exporters have an affirmative duty to inquire, verify, or otherwise substantiate the proposed transaction to satisfy themselves that the transaction does not involve a proliferation activity or does not violate other provisions of the EAR.
The fact that an end-user is listed on the Unverified List does not create a new licensing requirement for exports to these end-users. If exporters can satisfy themselves that the transaction does not involve a proliferation activity or does not violate any other provision of the EAR, then the exporter may proceed with the transaction.
If an exporter continues to have reasons for concern after the inquiry, then the exporter should refrain from the transaction or submit all the relevant information to BIS in the form of an application for a license or a request for an advisory opinion.
A: BIS may add names to this list from time to time where an end-use check cannot be completed; or remove names from the list when it is able to complete an end-use check for a party already on the list. Notice of changes to the Unverified List will be made through the Federal Register. This list will also be posted on the BIS Web site.