Export Shipping and Incoterms for Aerospace Parts
An international parts shipment needs two decisions: an Incoterms 2020 rule that sets who pays for and carries the risk of each leg, and an export control path that sets the authorization, the EEI filing in AESDirect and the statements on the invoice. Your export compliance team makes the second decision.
Updated
Read this first: general guidance, your compliance team decides
This page is general guidance for buyers and supply chain staff, not legal advice. Jurisdiction (ITAR or EAR), classification (USML category or ECCN), licensing and the filing on any given shipment are decided by your export compliance team, or by the design owner for its own technical data and hardware. Nothing here replaces their determination.
Two separate decisions sit on every international parts shipment. The commercial one is the Incoterms rule: who pays for and bears the risk of each leg. The regulatory one is export control: whether an authorization is needed, what must be filed in AES and what must be printed on the invoice. An Incoterms rule never answers the second question. How we keep controlled data and hardware with authorized U.S. persons and suppliers is set out on controlled programs.
Incoterms 2020 rules most used for parts
For crated or boxed aerospace parts moving by air, truck or container, the useful rules are the seven ICC lists for any mode of transport. FAS, FOB, CFR and CIF are for sea and inland waterway and fit bulk or vessel loaded cargo, not most parts shipments.
| Rule | Delivery and risk pass to buyer | Seller pays main carriage | Export clearance | Import clearance |
|---|---|---|---|---|
| EXW Ex Works | Goods made available at seller's premises, not loaded, not cleared for export | No | Buyer | Buyer |
| FCA Free Carrier | Handed to the carrier the buyer engaged, at seller's premises (loaded on buyer's vehicle) or at a terminal | No | Seller | Buyer |
| CPT Carriage Paid To | Handed to the carrier the seller contracted, in the seller's country | Yes, to the named destination | Seller | Buyer |
| CIP Carriage and Insurance Paid To | As CPT | Yes, plus insurance at Institute Cargo Clauses (A) or similar | Seller | Buyer |
| DAP Delivered at Place | At the named destination, ready for unloading | Yes | Seller | Buyer |
| DPU Delivered at Place Unloaded | At the named destination, unloaded | Yes | Seller | Buyer |
| DDP Delivered Duty Paid | At the named destination, ready for unloading | Yes | Seller | Seller |
Points worth acting on, from ICC's own guidance:
- EXW is for domestic sales. ICC advises exporters to use EXW, if at all, only for domestic sales, and its flowchart pairs EXW with a buyer willing to do both export and import clearance. If the seller will load and clear for export at its own dock, the rule is FCA at the seller's premises.
- CPT and CIP split cost from risk. The seller pays freight to the destination, but risk passes when the goods reach the first carrier. Damage in transit is the buyer's claim, so check the insurance.
- DDP can pose problems for the seller, in ICC's words, because the seller must clear the goods into the buyer's country.
- Name the place precisely. The delivery point decides both risk and cost, so write "FCA seller's dock, [street address], Incoterms 2020", not "FCA origin".
Incoterms rules do not decide when title passes or how and when payment is made, as the International Trade Administration notes; put those in the PO terms. Parties may still use an earlier edition if they name it.
Have a part like this?Send it in under a minute. A person replies within 1 business day.EAR or ITAR shipments, at a buyer level
Every export of a part is either subject to the International Traffic in Arms Regulations (22 CFR 120 to 130, administered by the State Department's Directorate of Defense Trade Controls) or to the Export Administration Regulations (15 CFR 730 to 774, administered by Commerce's Bureau of Industry and Security). The answer drives everything below.
| Topic | ITAR shipment | EAR shipment |
|---|---|---|
| Classification | USML category | ECCN on the Commerce Control List, or EAR99 |
| Authorization | DDTC license or an ITAR exemption | BIS license, license exception, or No License Required |
| EEI in AES | Required for hardware under a license or exemption, regardless of value | Required over $2,500 per Schedule B number, and always when a BIS license is required |
| Predeparture filing | At least 8 hours before departure by air or truck, 24 hours by sea or rail (22 CFR 123.22(b)) | By mode, from 1 to 24 hours before (15 CFR 30.4(b)(2)), see below |
| Invoice statement | 22 CFR 123.9(b): destination, end user, license or exemption citation and the statement | 15 CFR 758.6: the destination control statement and certain ECCNs |
Space and military parts often fall in the EAR's "600 series" or 9x515 entries rather than the USML, which changes the paperwork but not the need for care: 758.6 requires those ECCNs to be printed on the invoice. A supplier building to your drawing should get the jurisdiction and classification from you in writing; it should not be guessing at your design.
Electronic Export Information in AESDirect
Electronic Export Information (EEI) is the export record filed in the Automated Export System. Census describes ACE AESDirect, reached through the CBP ACE portal, as the primary, free tool for filing it. Once AES accepts a filing it returns an Internal Transaction Number (ITN), which goes to the carrier as proof of filing.
| Situation | EEI | Reference |
|---|---|---|
| Over $2,500 for one Schedule B or HTS number, one USPPI to one consignee on one conveyance | Required | 15 CFR 30.37(a) |
| $2,500 or less per Schedule B number, no license required | Exempt for those lines | 15 CFR 30.37(a) |
| BIS license required, or item subject to the ITAR | Required at any value | 15 CFR 30.2(a)(1)(iv) |
| Ultimate destination Canada | Generally exempt, except goods stored in Canada for third countries, goods moving through Canada to a third country, and the 30.2(a)(1)(iv) cases | 15 CFR 30.36 |
For items not on the USML, 30.4(b)(2) sets the latest time to file and give the ITN or exemption legend to the carrier:
| Mode | File no later than |
|---|---|
| Air, including air express couriers | 2 hours before scheduled departure |
| Truck, including express consignment | 1 hour before arrival at the U.S. border |
| Vessel | 24 hours before loading at the U.S. port |
| Rail | 2 hours before arrival at the U.S. border |
| 2 hours before exportation |
The U.S. principal party in interest (USPPI) or its authorized agent files. Census notes that an agent filing for you needs your written authorization, and recommends keeping the EEI and supporting documents for five years. Write on the PO who files, so a forwarder does not assume the other party did it.
Schedule B and ECCN on the invoice and in the EEI
The commodity code and the export classification are different numbers with different jobs, and both are commonly missing from supplier invoices.
- Schedule B or HTS number. A mandatory EEI field: the 10 digit Schedule B number, decimals omitted (30.6(a)(12)). It describes what the item is for trade statistics and duty, not whether it is controlled.
- License code. Mandatory in the EEI (30.6(a)(23)): the code that shows which agency's license or exemption, if any, covers the line.
- ECCN. A conditional EEI field (30.6(b)(6)) identifying the item on the Commerce Control List, or EAR99.
- ITAR fields. For USML hardware the EEI carries the USML category, the DDTC registration number and the license number or ITAR exemption citation (30.6(b)(5) and (b)(16)).
On the commercial invoice, 758.6 requires the ECCN for items in 3A090, 4A090, 9x515 and the 600 series, and for the seven ".z" entries when the item falls under a .z paragraph. For ITAR shipments the invoice must show the country of ultimate destination, the end user and the license number or exemption citation. Ask suppliers to print Schedule B and ECCN on every export invoice anyway, so the filer is not guessing from a part description.
Destination control statements
Under 15 CFR 758.6, when items on the Commerce Control List are exported in tangible form, the exporter must put the destination control statement (DCS) on the commercial invoice. Items designated EAR99 and shipments under License Exceptions BAG or GFT are excepted. The exact text required by 758.6(a)(1) is:
"These items are controlled by the U.S. Government and authorized for export only to the country of ultimate destination for use by the ultimate consignee or end-user(s) herein identified. They may not be resold, transferred, or otherwise disposed of, to any other country or to any person other than the authorized ultimate consignee or end-user(s), either in their original form or after being incorporated into other items, without first obtaining approval from the U.S. government or as otherwise authorized by U.S. law and regulations."
The ITAR statement in 22 CFR 123.9(b), required on the commercial invoice for tangible shipments made under a license or other approval, reads the same, along with the destination, end user and license or exemption citation. Have suppliers paste the regulatory text exactly rather than a paraphrase or a company legend, and check it at receipt before the crate is booked.
Denied party screening with the Consolidated Screening List
Screen every party to an export, not just the customer: the buyer, the ultimate consignee, intermediate consignees, the end user and the forwarder. The International Trade Administration's Consolidated Screening List (CSL) searches the export screening lists of three agencies at once.
| Agency | Lists in the CSL |
|---|---|
| Commerce, BIS | Denied Persons List, Unverified List, Entity List, Military End User List |
| State | Nonproliferation Sanctions; AECA Debarred List (DDTC) |
| Treasury, OFAC | Specially Designated Nationals, Foreign Sanctions Evaders, Sectoral Sanctions Identifications, CAP, Non-SDN Menu-Based Sanctions, Non-SDN Chinese Military-Industrial Complex Companies, Palestinian Legislative Council |
The CSL is an aid, not the official record. A potential match calls for additional due diligence before proceeding and a check against the official lists and Federal Register notices; the outcome may be a prohibition, a license requirement or an end use review. Keep a dated record of each screen with the order file, and screen again close to the ship date when the gap from order to shipment is long.
Temporary exports for repair, test or calibration
Sending a part abroad for repair, test, calibration or a demonstration and bringing it back is still an export and needs an authorization that matches its classification.
- EAR items. License Exception TMP (15 CFR 740.9) covers inspection, test, calibration and repair in paragraph (a)(6), for all destinations except Country Group E:1, along with tools of trade, exhibition and demonstration, and replacement part kits. Items must come back as soon as practicable and no later than one year after export; a longer stay needs a BIS license application at least 90 days before the deadline, up to four years from the export.
- ITAR items. DDTC may issue a temporary export license on form DSP-73 under 22 CFR 123.5, valid only for an export of less than 4 years, with the article returning to the United States and title not transferring to a foreign person while abroad.
- EEI. Under 15 CFR 30.37(q), temporary exports that are not license controlled and return within 12 months are exempt from EEI. ITAR hardware still needs EEI under 22 CFR 123.22 whether shipped under a license or an exemption.
Record serial numbers before the part leaves so the returning unit can be matched to it at receipt, and tell receiving inspection to expect it.
What to put on the PO or RFQ for an export shipment
- Incoterms rule, place and edition: for example "FCA seller's dock, [address], Incoterms 2020".
- Jurisdiction and classification: USML category or ECCN (or EAR99), as determined by your compliance team or the design owner.
- Authorization: license number, license exception or ITAR exemption citation, or NLR.
- Schedule B number for each line, 10 digits.
- Who files EEI and who receives the ITN; written agent authorization if a forwarder files.
- Invoice statements: 758.6 DCS or 123.9(b) statement, ECCNs where 758.6 requires them.
- Parties: ultimate consignee, end user, intermediate consignee and forwarder, each screened.
- Temporary export terms where the part is coming back: authorization, return date and serial numbers.
- Packaging and transport: see crating and packaging and shipping flight hardware.
If the order is also defense rated, put the rating and its elements on the same PO; see DPAS rated orders. The RFQ builder collects these fields with the rest of the request.
Quote an export shipment
Request a crating and shipping quote with the destination, the Incoterms rule you want, the classification your compliance team has set and the item's weight, value and sensitivities. Program facts are fine on the form; controlled technical data is not. We source qualified packaging and transport suppliers, flow your export instructions to them in writing and keep the invoice, statements and filing records with the shipment. A person replies within 1 business day.
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Part, quantity and date are enough to start. Drawings and the mutual NDA follow by reply, and controlled programs never send technical data through this site.
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Questions
Which Incoterms rule should I use to export aerospace parts?
For parts moving by air, truck or container, choose from the any mode rules: EXW, FCA, CPT, CIP, DAP, DPU or DDP. ICC advises EXW mainly for domestic trade, so for an export where the seller will clear for export at its own dock, FCA at the seller's premises is the usual choice. Your export compliance team should confirm who files and who holds the authorization, because the Incoterms rule does not settle export control questions.
Is EEI required for an ITAR shipment under $2,500?
Yes. The $2,500 per Schedule B number exemption in 15 CFR 30.37(a) does not apply to items subject to the ITAR or to items that need a BIS license; 15 CFR 30.2(a)(1)(iv) requires EEI for those at any value. Under 22 CFR 123.22(b), ITAR hardware must be filed at least 8 hours before departure by air or truck and 24 hours by sea or rail.
What is the exact wording of the destination control statement?
Under 15 CFR 758.6(a)(1) it begins "These items are controlled by the U.S. Government and authorized for export only to the country of ultimate destination for use by the ultimate consignee or end-user(s) herein identified" and continues with the prohibition on resale or transfer without U.S. government approval. Print the full text from 758.6 on the commercial invoice for CCL items; EAR99 items are excepted.
Does a denied party check on the Consolidated Screening List clear a shipment?
It is a screening aid, not a clearance. The CSL searches lists from Commerce, State and Treasury, including the Entity List, Denied Persons List, AECA Debarred List and the OFAC SDN List. A potential match calls for additional due diligence and a check of the official lists and Federal Register notices before you proceed, and a clean screen does not answer classification or licensing questions.
How do I send a part abroad for repair and bring it back?
Treat it as an export. For EAR items, License Exception TMP in 15 CFR 740.9(a)(6) covers inspection, test, calibration and repair, except to Country Group E:1, with return within one year. For ITAR items, DDTC may issue a DSP-73 temporary export license under 22 CFR 123.5 for less than 4 years. Your compliance team confirms the authorization and the EEI filing.
Do Incoterms decide when ownership of the parts transfers?
No. The International Trade Administration notes that Incoterms rules do not address when title passes or the method and timing of payment. They allocate delivery, risk, costs and clearance tasks. State title transfer, payment terms and any insurance requirement separately in the purchase order so they do not default to whatever the shipping term seems to imply.
Related
Sources
- ICC, Incoterms 2020 Checklist and Flowcharts (PDF)
- ICC, Incoterms 2020 overview
- ICC Academy, DAP and DDP explained
- International Trade Administration, Know your Incoterms
- eCFR, 15 CFR 758.6, Destination control statement and other information on the commercial invoice
- eCFR, 22 CFR 123.9, Country of ultimate destination and approval of reexports or retransfers
- eCFR, 22 CFR 123.22, Filing, retention and return of export licenses and filing of export information
- eCFR, 15 CFR Part 30, Foreign Trade Regulations (30.2, 30.4, 30.6, 30.36, 30.37)
- U.S. Census Bureau, Export filing in AES and ACE AESDirect
- International Trade Administration, Consolidated Screening List
- eCFR, 15 CFR 740.9, License Exception TMP
- eCFR, 22 CFR 123.5, Temporary export licenses
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