United States: Congress Moves Toward Sharply Higher Penalties for Export Control Violations

The U.S. export control framework may soon become significantly stricter. On October 28, a draft bill identified as H.R. 5853 was introduced in the House of Representatives, aiming to substantially strengthen civil penalties under the Export Control Reform Act (ECRA).

One of the key measures proposed is a sharp increase in the maximum civil fine. The current cap of $300,000 per violation could rise to $1.2 million, effectively quadrupling potential penalties for non-compliant exporters.

The bill also introduces a tougher penalty calculation mechanism. Civil fines could reach four times the value of the unlawful transaction, compared to twice the value under the current framework. This approach is designed to significantly enhance the deterrent effect of export control enforcement by directly targeting the economic benefits of non-compliance.

The proposal has been referred to the House Committee on Foreign Affairs for review. If adopted, it would compel companies engaged in international trade to reassess their export compliance programs, internal controls, and overall exposure to U.S. regulatory risk.