Anti-Diversion Clause

The anti-diversion clause is a U.S. government regulation that prohibits exported goods from being shipped to unapproved destinations. The Bureau of Industry and Security under the Department of Commerce requires commercially exported goods to be accompanied by a destination control statement. This document states that the goods are only authorized for export to certain locations and that U.S. law prohibits their diversion. The latter part of this statement is the anti-diversion clause.

In practice, you may see "anti-diversion" shortened to "diversion."

Understanding the Anti-Diversion Clause

The destination control statement and anti-diversion clause must appear on the invoice and ocean bill of lading or air waybill that accompanies the exported goods. The statement certifies that to the best of the shipper's knowledge, the shipment is headed to its stated destination. National security, nonproliferation treaties and foreign policy are some of the reasons why a government may be concerned with controlling its exports. In the U.S., most exports of items on the Commerce Control List must contain a destination control statement.

Diversion occurs when products are sold in unauthorized places. These restrictions could be for a number of reasons, including sanctions, trade issues and consumer safety concerns. When concerns arise, certain categories of goods are identified as those most likely to be illegally diverted to a restricted country. The bill of lading or other documents of such products will display official wording (called the destination control statement) that the license of the exporter is not valid except for specified receivers of the goods.

Anti-diversion worries are a fairly standard concern for companies exporting domestic goods.