Additional Details on BIS Wassenaar Final Rule Changes (Reporting, Etc.)

(The Wassenaar Arrangement advocates implementation of effective export controls on strategic items with the objective of improving regional and international security and stability.)

This is Part III, the final part of a multi-part series of summaries of the changes made by BIS’ Wassenaar final rule. (See ITT’s Online Archives or 09/08/10 and 09/09/10 news, 10090819 and 10090920, for Parts I and II. See ITT’s Online Archives or 09/07/10 news, 10090708, for BP summary announcing the publication of BIS’ final rule.)

15 CFR 734.4 - De Minimis U.S. Content

15 CFR 734.4(a)(4) is amended to read “There is no de minimis level for U.S.-origin technology controlled by ECCN 9E003a.1 through a.8, a.10, h, and i, when redrawn, used, consulted, or otherwise comingled abroad.”

(This amendment replaces the phrase ‘‘9E003.a.1. through a.11, and .h.’’ with the phrase ‘‘9E003.a.1 through a.8, a.10, h and i.’’ in order to harmonize paragraph (a)(4) with revisions to paragraphs ECCN 9E003.a.9, h, and i made by the final rule.)

15 CFR 742.14 - Significant Items: Certain Hot Section Technology

The final rule harmonizes the list of paragraphs under ECCN 9E003 that are controlled for Significant Item (SI) reasons with the list in 15 CFR 742.14. The paragraphs of ECCN 9E003 that are controlled for SI reasons are 9E003.a.1 through a.8, a.10, h and i.

15 CFR 743.1 - Wassenaar Arrangement

As a result of the Wassenaar Arrangement making changes to its Sensitive List, this rule makes corresponding changes to the reporting requirements of 15 CFR 743.1 (e.g., replacing 9E003.a.9 with 9E003.h).

This rule revises reporting requirements for ECCNs 4D001, 4E001 and 6A003.b.3. For 6A003.b.3, this rule adds the phrase ‘‘except imaging cameras specially designed or modified for underwater use.’’ For 4D001 and 4E001, this rule revises the APP from ‘‘0.1 Weighted TeraFLOPS (WT)’’ to ‘‘0.5 WT.’’ This rule makes editorial revisions to reporting requirements in ECCN 6A003.b.4. This rule adds Wassenaar Arrangement reporting requirements for ECCNs 6D003.a and 9E003.a.1 and a.3. Editorial revisions are made to the last sentence in 15 CFR 743.1(c)(2), to provide the correct description of where to find the guidelines for calculating APP in the EAR.

(As a matter of policy, BIS makes certain items on the WA Basic and Sensitive List (SL) eligible for license exceptions. However, because of the U.S. obligations under its agreements to the Wassenaar Arrangement, the U.S. must report on SL items exported outside of the Wassenaar Arrangement membership countries. BIS does this by gathering data from its licensing database. However, to collect data on exports made under license exceptions, BIS requires Wassenaar Arrangement reporting on SL items exported under certain license exceptions.)

Supplement No. 2 to 15 CFR Part 744 - Military End-Use License Requirement

As a result of Wassenaar Arrangement removing ECCN 4D003, the entry for ECCN 4D993 is revised to remove the reference to ECCN 4D003 in paragraph (4)(ii) of Supp. No. 2 to 15 CFR Part 744. BIS states that this change should not result in any change in license requirements or applications submitted to BIS.

15 CFR 772.1 - Definitions of Terms as Used in the EAR

As a result of the decisions reached at the 2009 Wassenaar Plenary, the final rule removes the following terms from 15 CFR 772.1: CE, Computing Element, Interconnected radar sensors, Personalized smart card, Q-switched laser, and Three Dimensional Vector Rate. The rule also revises references to categories in many definitions as a result of WA decisions.

This rule also adds the following terms as a result of Wassenaar Arrangement agreements: ‘‘Energetic materials’’ (Cat 1), ‘‘Fuel cell’’ (Cat 8), and ‘‘Laser duration’’ (there is no category designation for the term ‘‘laser duration,’’ because it is a term used in the definition of two other terms listed in 15 CFR 772.1).

The final rule also revises the following terms: ‘‘All compensations available’’ and removes and replaces references to categories in certain defined terms to be consistent with amendments made by this rule. This rule revises the definition of ‘‘all compensations available’’ by adding the phrase ‘‘or measuring errors for the particular coordinate measuring machine.’’

The definition of ‘‘Full Authority Digital Engine Control,’’ has been completely rewritten.

The note in the term ‘‘peak power’’ is removed because it included a definition for ‘‘laser duration,’’ which will now be defined as separate term in 15 CFR 772.1.

Savings Clause

Shipments of items removed from license exception eligibility or eligibility for export without a license as a result of this regulatory action that were on dock for loading, on lighter, laden aboard an exporting carrier, or en route aboard a carrier to a port of export, on September 7, 2010, pursuant to actual orders for export to a foreign destination, may proceed to that destination under the previous license exception eligibility or without a license so long as they have been exported from the U.S. before November 8, 2010. Any such items not actually exported before midnight, on November 8, 2010 require a license in accordance with this regulation.

¹According to BIS, the changes agreed to at the December 2009 Plenary that pertain to Export Control Classification Numbers (ECCNs) 5A002, 5D002, 6A002, 6A003, 8A002 and all related ECCNs will be implemented in a separate rule because of the sensitivity of the items and complexity of procedures and controls for these items. BIS also states that the changes agreed to at the December 2009 Plenary that pertain to raising the Adjusted Peak Performance (APP) for digital computers in ECCN 4A003 will be implemented in a separate rule when the President’s report for High Performance Computers has been sent to Congress that sets forth the new APP in accordance with the National Defense Authorization Act for FY1998

(BIS final rule, D/N 100413184-0299-01, FR Pub 09/07/10)