DDTC Issues Updated Guidelines for Electronic Agreements/Amendments Via D-Trade2

(Pursuant to a presidential directive, DDTC has made available the D-Trade2 production application for the agreement submission and adjudication process, which utilizes the DSP-5 license application as the primary vehicle for transmitting agreements and their respective amendments from one phase of the adjudication process to the next.

This electronic process will be available to all U.S. applicants beginning October 19, 2009. See ITT's Online Archives or 10/09/09 news, 09100930, for BP summary.)

Examples of Updated Guidelines

The following are examples of DDTC updated Guidelines for Preparing Electronic Agreements.

New provisios required. Under Section 2.0 (Agreements Overview) of the Guidelines, the following provisos will be applied to all agreements/amendments adjudicated through the electronic process:

"The Department of State approves the attached agreement/amendment proposal subject to the following limitations, provisos and requirements. This agreement/amendment may not enter into force until it is signed and the stated requirements have been satisfied. The issuance of the subject DSP-5 does not grant any export rights or privileges, and its related DSP-5 case number may not be cited as an authorization or used as the basis for an exemption."

Identification numbers through D-Trade2. Under Section 3.0 (General Guidance for Agreements), DDTC adds the following introductory paragraphs:

For tracking purposes, agreements will be issued two independent sets of identification numbers.

A nine-digit number with the "05" prefix will be generated automatically by D-Trade 2. This is the number of record for the proposed agreement or amendment and is the number referenced throughout the adjudication process. If the applicant has a query in reference to a submitted proposal, they must reference this number.

A second number, six-digits in length, which mimics the current format for paper licenses (e.g., 1807-09), will also be assigned upon receipt. This number serves as the actual agreement number and provides a common reference for all activities that occur under the approved agreement throughout its duration. This number will be included with the nine-digit number upon final action.

Duration of agreements. Under 3.1.d. (Duration of Agreements (Expiration Dates)), DDTC has added a new sentence stating that the duration of an agreement, regardless of how often it has been amended, cannot exceed ten years in duration.

New 3.1.e. states that on electronic approvals, the DSP-5 vehicle will automatically default to an expiration date of 48 months. This does not reflect the actual expiration of the agreement itself. (The DSP-5 vehicle is simply used as the means for transmitting the agreement throughout the approval process.) The expiration date approved for the agreement is specified in Proviso 1 of all authorizations.

Guidance for dual/third country nationals. Under 3.6. (Retransfer to Dual/Third Country Foreign National Employees), DDTC has added the following:

f. If dual/third country nationals are requested pursuant to 22 CFR 124.8(5) on an electronic agreement/amendment submission, the countries of the dual/third country nationals requested must be entered into Block 18 of the DSP-5 vehicle. For submissions requesting dual/third country nationals pursuant to 22 CFR 124.16, a statement indicating this request should be included in Block 20 of the DSP-5 vehicle. There is not a requirement to list 22 CFR 124.16 approved countries in Block 18 on such requests.

For dual/third country nationals pursuant to 22 CFR 124.8(5), the applicant must complete Block 18 of the DSP-5 vehicle as follows:

• NAME - Third Country National
• ADDRESS - TCN
• CITY - TCN
• COUNTRY - Enter country of the Dual/Third Country National
• ROLE - TCN

Only "conformed" amendments accepted. Under 6.2 (Proposed Amendment), DDTC has added a new paragraph (4), which states that DDTC will only accept amendments that have been "conformed" or consolidated. In other words, all major amendments MUST be submitted as entire agreements with proposed changes identified by bolded text (not "track changes"). Applications that simply describe which sections or articles to the agreement are being modified shall be Returned Without Action.

Electronic copies of minor amendments for WDAs. Under Section 8.0 (Amendments to WDAs), regarding 22 CFR 124.1(d) minor amendments, DDTC has added a sentence which states: Applicants must upload an electronic copy of each minor amendment, signed by all parties, to the latest approved amendment or to the basic agreement (if no amendment) within 30 days after the minor amendment is concluded.

Electronic re-baseline agreements. Under Section 9.0 (Re-Baseline of Agreements), DDTC has added an introductory paragraph: An agreement re-baseline is required for any agreement currently approved in paper format that the applicant desires to amend through electronic submission. All electronic submissions of proposed agreements must either be in the form of a new agreement or a re-baselined agreement.

Under new 9.1.b.(3) (Electronic Agreement Submissions), DDTC adds that the applicant is not authorized to submit an electronic amendment proposal for a previously approved paper agreement.

Electronic proviso reconsiderations. Under 13.1 (General Guidance for Proviso Reconsiderations), DDTC has added the following new paragraphs:

b. When a request for Proviso Reconsideration for previously approved electronic agreements is submitted, DTCL will record the submission as a major amendment to the affected agreement to maintain accountability of that case. As a result, the request MUST be submitted electronically via the DSP-5 vehicle.

c. If the applicant desires to make other modifications to the approved agreement in addition to the proviso reconsideration, this is permissible.

Electronic attachment requirements. Under Section 17.0 (Submitting and Packaging Agreements), DDTC has included the following instructions for electronic agreements/amendments:

1. 1.d. - When initially submitting new agreements, applicants must include the following attachments:

Transmittal letter

Proposed Agreement (with exhibits/appendices/annexes - same .pdf)

1. CFR 126.13 letter (if not satisfied by Block 22 of the DSP-5 vehicle)¹
2. CFR Part 130 Statement (when necessary)²

New 17.1.e. states that when initially submitting major amendments, applicants must also include all of the above attachments, as well as a signed copy of the last DDTC-approved amendment or agreement (where no amendment exists).

(See DDTC's updated guidelines for complete instructions on electronic submissions of agreements/amendments.)

¹As directed in 22 CFR 126.13, all requests for agreements or amendments must include a letter signed by a responsible official empowered by the applicant addressed to DDTC. (This requirement is usually satisfied by the statement included in Block 22 of the DSP-5 vehicle.)

²The 22 CFR Part 130 statement is made as part of Block 22, "Applicant's Statement," in the DSP-5 vehicle. Based on this electronic certification, a separate Part 130 certification is no longer required as part of the transmittal letter if submitting electronically.

DDTC guidelines (updated 10/07/09) available at http://www.pmddtc.state.gov/licensing/documents/PreparingElectronciAgreements-Guidelines.pdf