Closing a manufacturing company: engineering records and the five year clocks
A factory that closes leaves behind drawings, change orders, quality records and supplier correspondence, and some of them have federal clocks running. Export control records and injury logs are kept five years, and exposure records run much longer. What is left once those are set aside is the engineering and quality history that shows how a product design changed, which is the layer AI labs ask about.
Rules to read first
The export records section and the exposure records rule are the two that surprise owners most.
| Rule | What it requires |
|---|---|
| 15 CFR 762.6 | Records required by the Export Administration Regulations are kept five years from the latest of the export, the end of a license or other triggering events the section lists. |
| 22 CFR 122.5 | A registrant under the arms trade rules keeps records of manufacture, acquisition and disposition of defense articles and technical data. |
| 29 CFR 1904.33 | The OSHA 300 log, the annual summary and the incident reports are kept five years after the end of the calendar year they cover. |
| 29 CFR 1910.1020(d) | Employee exposure records are generally kept thirty years, and medical records for the length of employment plus thirty years, with listed exceptions. |
What the engineering history holds
Drawings are often owned by the customer who paid for the tooling. A rights check on every set comes before any license, and a part for a defense program may be controlled technical data that cannot go to a foreign lab at all.
- Engineering change orders with the reason, the approver and the part numbers affected.
- Quality records: nonconformance reports, corrective actions and the notes on how a root cause was found.
- Quote history: how a price was built up from material, labor and tooling.
- Supplier correspondence about substitutions and late deliveries.
- CAD files and drawings, where the company owns them.
Where it sits, and the trap
The records sit in an ERP system, a product data management tool, a quality system and the engineers’ own file shares. The trap is the PDM vault: a closing company stops paying for it and the revision history, which is the thing that shows how a design moved, is gone. Ask the vendor for a full export that keeps the revision tree, not just the latest files.
Customer-owned designs and parts under export control are covered on our page about CAD and engineering files. Treat any item with an export classification as out until counsel clears it.
What stays out
| Record | Why it stays out |
|---|---|
| Customer-owned drawings and tooling data | They belong to the customer and often sit under a confidentiality clause. |
| Export-controlled technical data | A transfer to a foreign party can be an export. |
| Employee medical and exposure files | Personal and subject to the thirty year rule. |
| Supplier pricing under a nondisclosure agreement | The agreement binds the company after it closes. |
Read next
- Closing or bankrupt companies. Who signs and what to keep.
- Records to keep before you close. A checker by industry.
- Liability. Who answers for what in a deal.
- Manufacturers while open. What a running plant can license.
Questions about closing a manufacturing company: engineering records and the five year clocks
Do export records matter if we only sold in the United States?
Only if the rules did not apply to the item. A company that shipped any controlled item abroad keeps the records for five years from the trigger.
Who owns the drawings?
It depends on the contract. Where a customer paid for the design, the customer usually does, and a license from the manufacturer alone is not enough.
Is the quote history safe to license?
After customer names, part numbers that identify a customer and any supplier prices under a nondisclosure agreement are removed.
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