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Top Commerce Officials Tout Expanded Use of STA, License Exceptions Through Export Control Reform

The Export Control Reform (ECR) initiative is fueling increased industry use of Strategic Trade Authorization (STA) and other license exceptions, but some companies remain reluctant to use STA due to fears of auditing and burdensome processing, said Commerce Department officials at a Bureau of Industry and Security (BIS) conference on July 29. Exporters have used STA for more than 3,700 export transactions under the CCL since October, while more than 7,000 license exceptions have been used in total, said Commerce Undersecretary for Industry and Security Eric Hirschhorn during a speech at the conference. “They’re designed to get stuff to our allies more quickly without red tape and efficiently,” said Hirschhorn to reporters following his speech. Other license exceptions exporters are permitted to use under the CCL as a result of the ECR effort include limited value (LVS), temporary (TMP), government (GOV), repair replacement (RPL) and technology/software (TSU) (see 14013009).

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STA provides another option for exporters, but won’t necessarily decrease the burden of processing export transactions, said Commerce Assistant Secretary for Export Administration Kevin Wolf. “What we’re creating options for companies based on different fact patterns,” said Wolf to reporters. “Let’s say they have a transaction involving, you know, 37 different countries, half in STA 36 and the other half outside. In those situations the use of a license exception could get very complex. It might be easier to have one authorization governing all the various parties.” The U.S. provides the STA option for transactions with 36 allies globally.

The industry use of STA may “take some getting used to,” said Wolf, adding that the use is increasing “exponentially” regardless. The top destinations for STA items include Canada, the United Kingdom, South Korea and Mexico, Wolf said. “All of this information, by the way, only pertains to the categories that have come online so far,” he said during a speech. “Satellites and electronics, which are very, very large categories in terms of their volume will be coming online and becoming effective at the end of the year.” The July 1 ECR rule on Category XI (Military Electronics) will enter into force on Dec. 30 (see 14070104). The ECR rule to transfer Category XV (Spacecraft and Related Articles) from the USML to the CCL will largely take effect on Nov. 10 (see 14051224). The Obama administration has so far finalized rules to revise 15 of the 21 USML categories. -- Brian Dabbs