Anti-Boycott Compliance: A Guide for Exporters

U.S. anti-boycott law prohibits American companies from cooperating with foreign boycotts the U.S. does not sanction — and, separately, requires them to report boycott requests they receive. In practice these rules target the Arab League boycott of Israel, and they catch many exporters by surprise because the trigger is often a single line buried in a purchase order, contract, or letter of credit. Knowing how to spot that line is the heart of compliance.

The Two Regimes

Two different bodies of law govern anti-boycott conduct, and they are administered by two different agencies. Most companies need to think about both.

The Bureau of Industry and Security enforces the EAR anti-boycott rules through its Office of Antiboycott Compliance (OAC). The Treasury Department, through the IRS, runs a parallel tax-based regime. The same boycott request can implicate both, so exporters generally address them together.

What the Rules Prohibit

The EAR anti-boycott provisions bar U.S. persons from taking certain actions to support an unsanctioned foreign boycott. The prohibited conduct includes:

• Refusing to do business with Israel or with blacklisted companies, when the refusal is in furtherance of a boycott
• Furnishing information about a person’s business relationships with Israel or with blacklisted persons
• Furnishing information about anyone’s race, religion, sex, or national origin
• Implementing letters of credit that contain prohibited boycott conditions
• Paying or confirming the terms of such a letter of credit

The common thread is cooperation: the rules do not forbid trading in the region, they forbid helping carry out a boycott the U.S. opposes.

The Reporting Requirement

Here is where many companies stumble. Even if you refuse to comply with a boycott request, you usually still have to report that you received it. Reporting and compliance are separate obligations — turning down the request does not erase the duty to disclose it.

Under 15 CFR 760.5, U.S. persons report reportable boycott requests to OAC quarterly. The filing is made on:

• Form BIS-621P for a single transaction, or
• Form BIS-6051P for multiple transactions in the same calendar quarter

Reports may be filed by mail or electronically. Separately, the IRS regime uses Form 5713, the International Boycott Report, filed with your tax return to report operations in or related to boycotting countries and any boycott requests or agreements. A request can require both a BIS filing and a Form 5713 entry, so treat them as a pair.

How Requests Show Up

Boycott requests rarely announce themselves. They appear as clauses in routine commercial documents — for example, a certification that goods are not of Israeli origin, that the seller is not on a boycott blacklist, or that a vessel is eligible to enter a particular port. Because the language is often technical and embedded in standard forms, the practical risk is not deciding to cooperate; it is failing to notice the clause at all. Train the people who read contracts, purchase orders, and letters of credit to flag boycott language and route it for review before signing or acting.

What Non-Compliance Costs

Anti-boycott violations are enforced under the EAR’s penalty framework. Civil penalties can reach the greater of roughly $374,474 per violation (the 2025 inflation-adjusted figure carried into 2026, updated annually) or twice the transaction value, and willful violations can bring criminal exposure. On the tax side, the consequence is loss of valuable tax benefits — including foreign tax credits and deferral — tied to the boycott-related activity. BIS regularly settles anti-boycott cases, so enforcement is active, not theoretical.

Building It Into Your Compliance Program

Anti-boycott review fits naturally inside a broader export compliance program. The core controls are document review (screen incoming contracts, orders, and letters of credit for boycott language), an escalation path (a clear route to compliance or counsel when a clause appears), reporting discipline (file the BIS form for the quarter and capture the item for Form 5713), and recordkeeping (retain the request and your response). Built in this way, the requirement becomes a checkpoint rather than a fire drill.

Frequently Asked Questions

Which boycott do these rules actually target? In practice, the Arab League boycott of Israel. The rules apply to any boycott of a country friendly to the U.S. that the U.S. does not itself sanction, but the Israel boycott is the one exporters encounter.

If I refuse a boycott request, do I still have to report it? Usually yes. Reporting and compliance are separate obligations. Receiving a reportable request triggers the filing duty even if you decline to cooperate.

What forms are involved? BIS Forms 621P (single transaction) or 6051P (multiple transactions per quarter) for the EAR regime, and IRS Form 5713 for the tax regime.

Where do boycott requests usually appear? In contract clauses, purchase orders, shipping documents, and letters of credit — often as a certification about Israeli origin or blacklist status. The language can be easy to miss, which is why document review matters.

Spotted boycott language in a contract or letter of credit? Reidel Law Firm prepares flat-fee Import/Export Compliance Memos that tell you whether a clause is reportable, prohibited, or harmless — with direct access to the trade attorney handling your matter. Get a flat-fee compliance memo →