For the full description, implementation variations, consequences, and detailed sample, see Page 246 in Java Application Architecture.
Exceptions should be close to the class or interface that throw them.
Sadly, dealing with exceptions in enterprise software systems is often an afterthought. But allocation of exceptions to modules has significant implications on the modularity, and more specifically the dependencies between modules, within our software system. Placing the exception close to a class that catches it will often cause a cyclic dependency between the module containing the class that throws the exception and the module containing the class that catches the exception. Exceptions should always be placed in a module closer to the class that throws the exception than a module closer to the class that catches the exception.