{"id":2524,"date":"2026-04-15T12:44:06","date_gmt":"2026-04-15T16:44:06","guid":{"rendered":"https:\/\/yormicklaw.com\/?p=2524"},"modified":"2026-04-15T13:04:17","modified_gmt":"2026-04-15T17:04:17","slug":"bis-enforcement-action-highlights-risks-in-de-minimis-calculations-for-foreign-made-items","status":"publish","type":"post","link":"https:\/\/yormicklaw.com\/es\/bis-enforcement-action-highlights-risks-in-de-minimis-calculations-for-foreign-made-items\/","title":{"rendered":"BIS Enforcement Action Highlights Risks in De Minimis Calculations for Foreign-Made Items"},"content":{"rendered":"
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Authors:<\/strong> Rachel M. Small, Counsel, and Jon P. Yormick, Managing Member<\/em><\/span><\/p>

In February 2026, BIS announced an enforcement action involving Teledyne FLIR LLC (\u201cFLIR\u201d or the \u201cCompany\u201d) related to exports of thermal imaging technology incorporated into foreign-manufactured systems. The case demonstrates the growing compliance risks associated with exports to China and Hong Kong, as well as misapplying the EAR\u2019s de minimis<\/i> rule, particularly in complex, global supply chains.<\/p>

The Enforcement Action<\/h4>

In this case, BIS determined that thermal imaging cameras (ECCN 6A003) were incorporated into foreign-manufactured drone camera systems exported to China and Hong Kong. The FLIR camera kits included uncooled focal plane arrays (UFPAs) classified under ECCN 6A002.a.3.f.\u00a0 The Company concluded the finished items were not subject to the EAR because the US-origin controlled content fell below the 25% de minimis<\/i> threshold. BIS disagreed and stated that FLIR calculated the US-origin controlled content based on a single component rather than the full controlled system, excluded certain components from the overall valuation of the finished product, and used a \u201cmarket collaboration fee\u201d structure that inflated total product value and diluted the percentage of US-origin controlled content<\/p>

Notably, BIS characterized aspects of the conduct as potentially constituting evasion of export control requirements under 15 CFR \u00a7 764.2(h). The agency emphasized that companies cannot structure pricing or valuation mechanisms designed to artificially reduce the percentage of US-origin controlled content.\u00a0<\/p>

In its Proposed Charging Letter (\u201cPCL\u201d), BIS proposed charging FLIR with nineteen (19) violations in total, including nine (9) counts of causing a violation, one (1) count of evasion, one (1) count of failure to comply with recordkeeping requirements, and eight (8) counts of engaging in prohibited conduct.\u00a0 The result was a $1 million penalty and findings that the products remained subject to the EAR and required authorization. See a copy of the final order here<\/a>.\u00a0<\/p>

Compliance Lessons for Industry\u00a0
<\/b><\/h4>

The important takeaways from the FLIR case are that:\u00a0<\/p>