BIS Final Rule Corrects and Clarifies the Export Administration Regulations

BIS states that as the regulations at issue involve a U.S. military and foreign affairs function, among other things, provisions requiring a notice of proposed rulemaking and opportunity for public comment do not apply. However, BIS states that public comments on this regulation may be submitted.

Highlights of BIS' Final Rule

According to BIS, the following corrections and clarifications have been made to the EAR by this final rule (partial list):

15 CFR 730.8(c) and Supplement No. 3 to 15 CFR Part 730 - BIS states that 15 CFR 730.8(c) (How to Proceed and Where to Get Help) is revised to correctly state names of offices, addresses, phone and facsimile numbers associated with the U.S. Export Assistance Center in San Jose, CA (in place of the Santa Clara Branch Office of the Department of Commerce).

In Supplement No. 3 to 15 CFR Part 730 (Other Government Departments and Agencies with Export Control Responsibilities), the office title, description of items processed, phone number and fax number of the Department of Energy (DOE) is revised. The EAR now states that the export control responsibilities of the DOE consist of nuclear technologies and services which contribute to the production of Special Nuclear Material (Snm), and technologies covered include nuclear reactors, enrichment, reprocessing, fuel fabrication, and heavy water production. 15 CFR 732.3(h)(2) - In this paragraph of the section entitled, Steps Regarding the Ten General Prohibitions (Step 13 - Prohibited end-uses and end-users), BIS states that old terminology is being removed (i.e. OTS (operational technology and software), STS (sales technology), and SUD (software updates)).

Supplement Nos. 1 and 2, 15 CFR Part 732 - BIS states that the flow charts entitled, "Am I Subject to the EAR" and "Export Control Decision Tree" are replaced with simpler and easier to read versions. See BIS' final rule for updated versions of these flow charts.

15 CFR 734.1(a) - BIS states that in 15 CFR 734.1(a) (Introduction to the Scope of the EAR), a correction is made to clarify the meaning of the fifth sentence. This sentence now states "if neither your item nor your activity is subject to the EAR, then you do not have any obligations under the EAR and you do not need to review other parts of the EAR. This paragraph had previously stated that "if your item or activity is not subject to the EAR."

15 CFR 734.3(b)(4) - BIS states that 15 CFR 734.3(b)(4) (Items subject to the EAR) is corrected to state that foreign-made items that have less than the de minimis U.S. content based on the principles described in 15 CFR 734.4, are not subject to the EAR.

(This paragraph had previously stated that such items with a U.S. content greater than the de minimis content were not subject to the EAR.)

15 CFR 736.2(b)(3)(i) - BIS states that paragraph 15 CFR 736.2(b)(3)(i) (General Prohibition Three - Reexport and export from abroad of the foreign-produced direct product of U.S. technology and software) is corrected by adding a phrase to clarify that exports, reexports, or exports from abroad of items subject to the scope of General Prohibition Three to Cuba, Libya, or a destination in Country Group D:1 are permitted under the authority of a license or eligible License Exception. The regulations previously stated that such items could not be exported, reexported, or exported from abroad.

15 CFR Part 740 - BIS states that in 15 CFR Part 740 language is being added to the description of the scope of items eligible for License Exceptions for Shipments to Country Group B Countries (GBS) (15 CFR 740.4), Civil-end Users (CIV) (15 CFR 740.5), and Technology and Software Under Restrictions (TSR) (15 CFR 740.6), to clarify that items eligible for these License Exceptions are those that require a license for national security reasons only.

15 CFR 740.9(a)(2)(viii)(3)(B) - BIS states that in 15 CFR 740.9(a)(2)(viii)(3)(B) (Temporary Exports), the title and room number is corrected for the Office of Export Enforcement located in Room H4616.

15 CFR 740.13(a)(1) - BIS states that in 15 CFR 740.13(a)(1) (Operation technology and software under TSU), a clarification is made by replacing the word "products" with the words "commodities or software".

15 CFR 746.2(a)(1)(ii) and 746.4(b)(2)(ii)(B) - BIS is adding clarifying language in 15 CFR 746.2(a)(1)(ii) (License Exceptions for Cuba) as well as 15 CFR 746.4(b)(2)(ii)(B) (Reexports to Libya) to correctly describe the scope of operation technology and software eligible under License Exception TSU to Cuba and Libya. BIS states that the word "products" is also being revised to read "commodities or software".

15 CFR 746.4(c)(2)(vii)(A) - In 15 CFR 746.4(c)(2)(vii)(A) (License Policy for Libya), BIS is fixing a typographical error to correctly describe the capacity of the pumps to transport crude oil and natural gas that generally are subject to a denial policy. BIS has revised the phase "equal to or larger than 3500 cubic meters per hour" to now read "equal to or larger than 350 cubic meters per hour".

15 CFR 746.7 - BIS states that it is revising 15 CFR 746.7 (Iran) so that the first sentence of the introductory paragraph is revised to update the authority references for the section.

15 CFR 748.2(a) - BIS states that a revision is being made to 15 CFR 748.2(a) (Obtaining forms, mailing addresses) to correctly state names of offices, addresses, phone and facsimile numbers. The offices whose information has changed are: the Outreach and Export Services Division, the Western Regional Offices, and the U.S. Export Assistance Center.

15 CFR 750.7 - With respect to 15 CFR 750.7 (Issuance of licenses), BIS states that it is amending this section by revising 15 CFR 750.7(c)(1)(viii) to allow the exporter to revise the wording of the item description on a license (although not necessary for the purpose of conforming to an official revision in the Commerce Control List (CCL)) without having to obtain a replacement license. According to BIS, this revision will not allow an actual change in the item to be shipped or an increase in the total price or quantity on the license.

15 CFR 752.3(a)(2) and (a)(3) - BIS states that 15 CFR 752.3(a)(2) and (a)(3) (Eligible Items for export and reexport under the Special Comprehensive License) references to the Export Control Classification Numbers (ECCNs) were corrected. Specifically, BIS states that ECCNs 1E350 and 1E351 were removed from paragraph (a)(2) and added to paragraph (a)(3).

Supplement No. 3 to 15 CFR Part 774 - BIS states that Supplement No. 3 to 15 CFR Part 774 (Cross-Reference List) is removed because it is no longer necessary and has become confusing since the implementation of Wassenaar revisions to the CCL.

Changes to certain citations - BIS also states that the certain citations have been changed in the following paragraphs: 15 CFR 734.4(d); 15 CFR 740.12(b)(5)(iii); and 15 CFR 746.4(b)(2).

BIS Contact - Sharron Cook (202) 482-2440

BIS Final Rule (D/N 031212313-3313-01, FR Pub 02/06/04) available at http://a257.g.akamaitech.net/7/257/2422/14mar20010800/edocket.access.gpo.gov/2004/pdf/04-1737.pdf