I've also heard numerous figures so I decided to do some digging and found out the real cost. It is
$2250 annually for a new Registrant. So next time we all want to buy something from brownells, and want to know the updated list of Registered Companies, now we know what it costs to get onto that list annually.
You would think more companies would do it, assuming the company thinks they can sell more product to us than the fee costs.
http://www.pmddtc.state.gov/registration/faqs.html
You misunderstand "the list" as Brownells calls it. The Brownells list is NOT a list of State Department registered companies, it is a list of companies that Brownells will exports products from. An example fo this is the fact that Brownells says SIG is not on their list yet SIG is in fact not only a Registered US State Department Manufacturer but also themselves a Registered State Department Exporter.
There are 2 different registration requirements: First is the requirement that ALL companies that make ANY item considered to be ITAR related (this includes magazines, parts, etc.) MUST be registered with US State Department as an ITAR Registered Manufacturer (regardless of desire or intention to export their products). Second is the requirement that for any company to apply for an export license from State Department of any ITAR related goods, that exporting company (whether they be the actual manufacturer or simply an exporter) must first be registered with US State Department as a Registered ITAR Exporter.
A company does not have to be a registered exporter to allow a different company to export their products... they only need be registered with State Department as a Manufacturer and that is required by Federal Law whether the company exports their products or not.
You also left out the part about State Department Fees that also stipulates that the exporter will also pay (in addition to the initial $2,250 for first time registrants and $2,750 for renewal registrants) an additional fee of either 3% of the value of ALL export licenses processed during the previous 12 month period or a flat rate fee of $250.00 per export license processed during the previous 12 month period, whichever of the two is less.
Brownells processes hundreds to thousands of small value permits, but since the average permit value is probably not that high they in all likelihood are able to take advantage of the 3% method... We process fewer permits but the value of the average permit is high so we end up paying the flat rate $250 per permit method. For us 100 permits end up costing us $25,000 plus the $2,750 base fee = $27,500 for annual permit renewal (as an example).
This does not include the hours of labour it takes to prepare and submit and process the permit applications and the exports made on them.
Most small US manufacturers don't want to register as exporters, not so much because of the cost for registration as the cost for the labour involved in handling international orders and paperwork and licensing. The cost to process an DSP-5 export license application to allow shipment of a $50 part or a $200 order to somebody in Canada or overseas is simply higher than the profit they'll make on that item. Simple economics. Much easier to let a distributor like Brownells handle international orders.
Mark