BIS Reduces Licensing Requirements for U.K. and Australia, Advancing AUKUS, Agency Says

The agency’s interim final rule, released April 18, amends the Export Administration Regulations so that “Australia and the UK will have nearly the same licensing treatment under the EAR as Canada,” BIS said in the rule.

It removes Commerce Control License requirements “to allow Commerce-controlled military items, missile technology-related items, and hot section engine-related items to be exported or reexported to Australia and the UK without a license,” said the agency’s news release. “As a result, many Commerce-controlled items, including certain satellite-related items, will now be eligible for export or reexport to Australia and the UK without a license.”

The changes take effect April 19, upon publication of the interim final rule in the Federal Register. Comments on the changes are due June 3.

The interim final rule removes license requirements for Australia and the U.K. under national security column 1 (NS1), regional stability column 1 (RS1) and missile technology column 1 (MT1) reasons. “With these changes, ‘600 series’ items, which are generally items on the Wassenaar Arrangement Munitions List, will no longer require a license to Australia or the UK,” BIS said.

“These changes will significantly reduce the volume of BIS licenses for exports, reexports, and transfers to and within Australia and the UK, as BIS previously issued over 1,800 licenses per year for such items to Australia and the UK,” the rule said.

The final rule also removes license requirements for “military commodities described under ECCN 0A919” for Australia and the U.K., “further aligning their treatment with Canada,” BIS said.

BIS is also “removing military end-use and end-user-based license requirements for exports, reexports, and transfers (in-country) of certain cameras, systems, or related components” for Australia and the U.K., including for commodities described in ECCNs 6A003.a.3, 6A003.a.4, or 6A003.a.6 that will be or are intended to be used by a military end-user, as well as some commodities under ECCNs 6A993.a, 6A002, 6A003, 6A993.a and 8A002.d that will be or are intended to be incorporated into a “military commodity” controlled by ECCN 0A919.

“Finally, BIS is revising its treatment of significant items (SI) (i.e., hot section technology for the development, production or overhaul of commercial aircraft engines, components, and systems) controlled under ECCN 9E003.a.1 through a.6, a.8, .h, .i, and .l, and related controls to allow these items to be exported, reexported, or transferred (in-country) to or within Australia and the UK without a license, consistent with the current exception for Canada,” the agency said.

BIS also is making more “minor policy changes” to align controls on Australia and the U.K. with those on Canada. Among these are expanding the “explicit applicability” of license exceptions Aircraft, Vessels and Spacecraft (AVS), Additional Permissive Reexports (APR), and Encryption Commodities, Software and Technology (ENC) for use to Australia, Canada and the U.K.

The expansion of license exception AVS will allow Australian and U.K. airlines to receive MT1 items as spare parts “in most destinations,” BIS said.

“BIS notes one particular license requirement that will remain unchanged as a result of this rule,” it said in the interim final rule. “Under the EAR, firearms-related items and other CC controlled items in ECCNs 0A501 (except 0A501.y), 0A502, 0A503, 0A504, 0A505. a, .b, and .x, , 0A981, 0A982, 0A983, 0D501, 0D505, 0E501, 0E502, 0E504, 0E505, and 0E982 will continue to require a license when destined to and among the UK and Australia.”

Likewise, existing license requirements will remain in place for “certain satellites and related items,” some goods controlled under the Chemical Weapons Convention and “items controlled for short supply reasons (e.g., certain petroleum products and Western red cedar),” and “Certain law enforcement restraints and riot control equipment, implements of torture or execution, and horses exported by sea,” BIS said in its news release.

Nonetheless, “significantly reducing licensing requirements for Australia and the United Kingdom (UK) to foster defense trade and technological innovation,” the news release said. “BIS anticipates these changes will reduce licensing burdens for trade with Australia and the UK by over 1,800 total licenses valued at over $7.5 billion per year.”

“Today’s action dramatically reduces the scope of BIS export controls for trade with Australia and the UK,” Assistant Secretary for Export Administration Thea Kendler said in the news release. “We support the principles of AUKUS, and look forward to the joint innovation that will come from this move. This rule also enables BIS to further focus our resources on scrutinizing high-risk exports to countries of concern.”