Revenue Restored: A Successful Export Reclassification for a U.S. Laser Manufacturer
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mars 12, 2025
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A U.S.-based pioneer in high-performance fiber lasers — bringing advanced solutions to manufacturers, institutions and laboratories around the world – faced a catastrophic threat to its bottom line following an export halt and licensing requirement on one of its mainstay products.
After an unfavorable commodity classification ruling from the Bureau of Industry and Security (“BIS”) prevented the client from exporting its packaged laser diodes anywhere beyond Canada without authorization, the Defense Technology Security Administration (“DTSA”) argued the components could be of military use, requiring a license for every export and customer. This would result in a significant administrative burden and process that usually takes three to six months per application. With so much at stake and the clock already ticking, the client turned to FTI Consulting for emergency expert guidance.
- The original challenge to the ruling led to a rare disagreement among regulators about where the technology should be classified. By providing an exhaustive report detailing the science behind the product and its widespread application across a number of industries, both BIS and DTSA supported the client’s position.
- Following a concerted effort with product engineers, general counsel, BIS and DTSA, the ruling was reversed.
- Most companies often accept commodity classification rulings, yet through our guidance, the client was able to tactfully and effectively challenge the decision — leading to resumed business and avoidance of significant revenue loss.
Our Role
- In collaboration with the client, FTI Consulting prepared and executed a thorough investigation challenging both BIS and DTSA in an unusually nuanced case.
- FTI Consulting partnered with the client’s engineering team to understand every corner of the technology and, when evaluating the original ruling, we uncovered key misconceptions around the component.
- Leveraging strong relationships with regulators, we were able to expedite a complicated scenario and successfully advocate for reclassification.
Date
mars 12, 2025
Contacts
Senior Managing Director