What is a routed transaction under the EAR?

A routed transaction under the Export Administration Regulations (EAR) involves the transfer of responsibility for export compliance through documentation. This means that when a routed transaction occurs, the exporter provides the required export documentation, and the responsibility for ensuring compliance with export laws shifts to the party receiving that documentation. This is significant in international trade because it delineates who is responsible for adhering to export regulations and ensures that the necessary steps are taken to comply with legal requirements. This establishes clarity and accountability in the export process, particularly when multiple parties are involved in a transaction.

In contrast, other options do not encompass the essence of routed transactions according to EAR. For example, simply transferring goods without documentation lacks the compliance aspect, while a direct shipment does not necessarily involve the transfer of responsibility for compliance. Lastly, transactions involving only financial institutions do not cover the broader scope of routed transactions in trade.