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Export Controls Organisation (ECO) details plan for reforms.

The Department for Business Innovation and Skills (BIS) has yesterday published a letter from Edward Bell, head of the Export Controls Organisation (ECO) to techUK outlining plans to take forward two major reviews aimed at reforming export controls for UK based electronic component and systems manufacturers. These plans are in response to the detailed report by techUK which was published by BIS and the ECO's commitment to implement change to improve the export controls environment for UK based manufacturers.

The ECO has committed to review two keys areas which the techUK report identified as impacting negatively on UK exporters, along with the actions that can be implemented to improve business opportunities:

Firstly, in response to Finding 1 in techUK’s report (competitive disadvantage caused by the way the UK implements export controls), the ECO will review the system of End User Undertakings to simplify their scope and application to reduce the regulatory burden on UK exporters.

Secondly, related to techUK’s Finding 2 (licensing lead times), ECO will review open general licensing to determine the scope for moving more exports to light touch licensing arrangements, which exporters may register for online for immediate use without End User Undertakings. This would expand the scope of Open General Licences which provide quick access to “off the shelf” licensing cover for a range of exports and destinations.

The ECO has further recommended that techUK works with ADS in consulting stakeholders since these to reforms have the potential to significantly benefit members in both organisations. techUK has already started this process and the matter has been raised in the ADS EGAD executive committee.

Paul Everitt, CEO of ADS Group comments: "Defence and security exports are of strategic importance to the UK’s security and prosperity.

"These plans for reform are an important and positive development, which have the full support of industry. ADS and its members will engage fully with the forthcoming consultation."

Both ECO reviews will begin in October with the aim of making recommendations to Ministers for reform by the end of December.

In relation to techUK’s third main finding, the ECO is making proposals to Ministers for the reintroduction of a comprehensive Control List Classification Advice Service. This would provide exporters with one-to-one access to expert advice about how controls apply to their products and services.

Although finding the finance for this service within a climate of shrinking budgets may be challenging, techUK members are acutely aware of how the lack of this service is actually restricting exports and the growth of UK businesses. However, the ECO acknowledges that they must be involved in helping UK businesses manage the risk of doing business overseas, in ensuring that exports do not breach sanctions and embargoes.

Tim Tatton CEO of Invotec, a UK based manufacturer of components for aerospace & defence applications, said; “We are pleased with the positive steps forward that the ECO appear to be making with techUK to streamline the export licencing process. As a renowned and respected UK based manufacturer of components for aerospace and defence applications, we have seen many opportunities to grow our exports in recent times to what we would consider safe destinations, such as the EU and NATO countries.

"The UK’s high tech industry prides itself on flexible manufacturing of high mix, often low volume, high quality products with lead times and service that keep us ahead of our competition. Unfortunately we have seen first-hand that the current protocols are creating a real challenge to the running of our business in a number of ways.

We look forward to embracing changes to current licensing regime that maintains security but also recognises the scope the current challenges to the customer and supply chain relationship."

Julian David, techUK CEO comments: "This report coming as it does in the week of DSEI shows both the opportunity for the digital technology industry to play a huge part in delivering on the government's plans for export growth but also the need for practical support from the parts of government charged with helping industry.  

“Too often in the past it has seemed to industry that other countries do a better faster job in supporting their exporters and this commitment by the ECO gives the UK the chance to become a leader not a laggard in export practice." 

Ken Ball, techUK Head of Electronics said: "techUK welcomes the detailed response and review process being initiated by the ECO. We look forward to working with ECO and BIS as well as ADS EGAD to ensure that businesses can benefit from the improvement actions, as outlined in ECO's letter, at the earliest opportunity."