The Foreign Trade Regulations (FTR) mandates the filing of Electronic Export Information (EEI) in the Automated Export System (AES) for shipments of physical goods. The key word here is “physical.” In order for an item or product to be reported in the AES, you must be able to touch it. So what about exports of software, is this considered a physical good that requires an AES filing? The answer: it depends on whether you’re exporting mass market or customized software.
If you are exporting a shipment of mass market software, EEI must be reported in the AES. Mass market software is defined in the FTR as software that is “generally available to the public, and designed for installation by the user without further substantial technical support by the developer or supplier.” To easily determine if your software is considered mass market, ask yourself if you can purchase it at the local computer store. If your answer is yes, then you have mass market software and the shipment should be filed in the AES prior to export. When reporting the value for this software, report the selling price of the software or the cost of the goods if not sold (FTR 30.1).
Unlike mass market software, exports of customized software are typically exempt from reporting in the AES, unless there is a licensed required. Stay tuned for my next blog where I’ll cover this in more detail.