When Does Your Product Need ITAR PCB Manufacturing and Design Services?By ZM Peterson • Nov 11, 2020
Aerospace and defense electronics companies have plenty of regulatory concerns to consider. Most regulatory restrictions and industry standards on domestic electronics and PCBs are intended to ensure quality, environmental safety, worker safety, and reliability. While these regulations are intended to protect the end customer and the broader public, there are more stringent regulations surrounding who is allowed to access technical data on aerospace and defense electronics.
Chief among these for defense contractors and PCB design firms is the International Traffic in Arms Regulations (ITAR) and the Export Administration Regulations (EAR). For aerospace and defense manufacturers and designers, ITAR is the more important of the two: ITAR governs defense equipment, while EAR basically governs everything else. ITAR governs who is allowed to produce, transfer, view, or retransfer defense articles, both for themselves or on behalf of another entity. For aerospace and defense electronics companies looking to produce new equipment for their systems, they should consider how to engage a PCB design firm and access ITAR PCB manufacturing when producing a new product.
Disclaimer: I ask that you not construe what is said in this blog (or any other blog I’ve written) as legal advice; check with a compliance professional if you need more information.
When is ITAR PCB Manufacturing Compliance Required?
ITAR compliance in electronics development begins with registering with the US State Department’s Directorate of Defense Trade Controls (DDTC). There are other requirements required before DDTC registration, namely registering in SAM and obtaining a CAGE code. Depending on the type of registration with DDTC, a manufacturer is certifying they are aware of ITAR requirements and are in compliance with these requirements. According to the DDTC website:
- The Arms Export Control Act requires that all manufacturers, exporters, temporary importers, and brokers of defense articles (including technical data) as defined on the United States Munitions List (ITAR part 121) and furnishers of defense services are required to register with the Directorate of Defense Trade Controls (DDTC) as described in ITAR part 122 (part 129 for brokers).
In other words, if your product is classified as a defense article and/or is entered on the United States Munitions List (USML), you’ll need to follow ITAR requirements. This even applies to products that are not intended for use in defense systems, but could reasonably be used in a defense article; if it appears on the list then it’s subject to ITAR compliance requirements. These requirements govern who is allowed to manufacture, receive, view, and transfer technical data and finished products. Note that registration by an American firm does not grant export authority, this is under an export license issued by the State Department.
Companies that design defense systems and need to have their electronics manufactured should engage with an ITAR-compliant design and manufacturing firm to ensure they remain compliant. The process for ensuring compliance in these engagements isn’t specified, but there are common requirements around transmission, storage, and viewing of design data that design firms should understand.
This OpenVPX backplane was designed by Northwest Engineering Solutions for a guided munitions system and was produced by our ITAR PCB manufacturing partners.
The Role of a PCB Design Firm as an ITAR Broker
Not all aerospace and defense electronics companies are manufacturers; they often order PCB design and manufacturing services from external vendors. Similarly, not all ITAR PCB manufacturing firms have in-house design capabilities; they have to contract this out to an external design firm or contractor. Finally, we’ve found that an aerospace and defense firm may need both design and manufacturing services. If the prime vendor doesn’t know who is best to design and manufacture their product, or they don’t want to oversee management of these processes, this is where ITAR-compliant brokers can come into play.
The role of an ITAR broker has been muddied over the recent past thanks to rules changes. In general, a broker is any person who engages in brokering activities, and brokering activities means any action to facilitate the manufacture, export, reexport, import, transfer, or retransfer of a defense article or defense service. This definition has held since before the 2013 rules change to ITAR part 129.
The most recent modification to ITAR part 129 in 2013 narrowed the definition of who qualifies as engaging in brokering activities. These changes are expected to reduce the number of required DDTC registrations and provide greater clarity of who is acting as a broker. Of particular for ITAR PCB manufacturing and design are the following changes:
- Foreign persons, other than those owned or controlled by US persons, are excluded from registering as brokers.
- Regular employees and of affiliates acting on behalf of other affiliates when all end-points are ITAR compliant.
In other words, for an electronics project involving PCB design and manufacturing, the fabricator and assembler would need to be registered with DDTC as a defense article manufacturer. In addition, the prime vendor, who will most likely export or transfer defense articles to another party, would also need to be registered. Compliance requirements are eased when working with a design firm that provides managed ITAR PCB manufacturing services for aerospace and defense electronics companies. Depending on how deals and subcontracting arrangements are structured, the design firm may also need to be compliant, which should be considered when searching for PCB design and manufacturing services.
The experienced PCB design and layout team at NWES has a track record of working with aerospace and defense electronics companies. We’ve designed advanced RF systems, high speed backplanes, power systems, IoT devices, and much more. We’ve also partnered directly with EDA companies and multiple ITAR PCB manufacturing firms, and we help our clients get through the PCB manufacturing process with ease. Contact NWES for a consultation.