Chemical Weapons Convention Implementation Regulations

DEPARTMENT OF COMMERCE

Bureau of Export Administration

[Docket No. 941112-4312]

RIN 0694-AB06

Chemical Weapons Convention Implementation Regulations

AGENCY: Bureau of Export Administration, Commerce.

ACTION: Notice of the development of regulations to implement U.S.

industry obligations under the Chemical Weapons Convention.

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SUMMARY: The Bureau of Export Administration (BXA) is providing notice

that it is developing regulations and procedures that specify industry

obligations under the Chemical Weapons Convention (CWC). The CWC

requires that upon its entry into force, each country that ratifies the

Convention adopt the necessary measures to implement its obligations.

These include the establishment of a National Authority to oversee

compliance with the CWC, and enactment of implementing legislation with

penalties for noncompliance. Accordingly, the Clinton Administration

has submitted both the treaty and the related implementing legislation

to the Congress for consideration.

This advance notice and request for comments is being issued to

solicit public comments from industry and the interested public on

industry obligations under the CWC before BXA begins to draft

regulations.

DATES: Comments should be received by January 23, 1995.

ADDRESSES: Written comments (six copies) should be sent to Nancy Crowe,

Regulatory Policy Division, room 1087, Office of Exporter Services,

Bureau of Export Administration, Department of Commerce, P.O. Box 273,

Washington, DC 20044.

FOR FURTHER INFORMATION CONTACT: For general information, contact Nancy

Crowe, Office of Exporter Services, Bureau of Export Administration,

telephone: (202)482-2440.

For information on seminars, contact Rodney Menas, Office of

Exporter Services, Bureau of Export Administration, telephone: (202)

482-6031.

For a copy of the official text of the Chemical Weapons Convention,

entitled ``Convention on the Prohibition of the Development,

Production, Stockpiling and Use of Chemical Weapons and on Their

Destruction'', contact the Arms Control and Disarmament Agency,

telephone: (800) 581-ACDA.

For a copy of ``The Chemical Weapons Convention: Guidance for

Industry on How to Comply'', contact Peter Ruzicka, Office of

Congressional and Public Affairs, Bureau of Export Administration,

telephone: (202) 482-2721.

SUPPLEMENTARY INFORMATION: On January 13, 1993, the United States along

with over 130 other countries signed the Chemical Weapons Convention

(CWC, or Convention), and in doing so recognized that chemical weapons

(CW) should never be used as implements of war.

The CWC prohibits the development, production, acquisition,

retention, transfer and use of chemical weapons. It also requires that

each signatory destroy its stocks of chemical weapons, dismantle its

chemical weapons production facilities and refrain from assisting any

other country's CW programs.

The chemicals covered by the CWC are divided into ``schedules''

based on their possible utility in developing chemical weapons.

Schedule 1 covers known warfare agents and their immediate precursors,

which have very limited industrial and medical applications. Schedule 2

covers toxic chemicals and precursors that have some industrial uses,

and Schedule 3 covers chemicals with broader commercial applications.

The CWC also covers ``other relevant facilities'' that produce

unscheduled discrete organic chemicals or discrete organic chemicals

containing phosphorus, sulphur or fluorine above specific thresholds.

The U.S. chemical industry is dynamic and broad-based. It includes

over 12,000 plants, employing over 860,000 people. Based on employment

information published in the Bureau of the Census 1990 County Business

Patterns, chemical manufacturing facilities are located in nearly every

state.

According to the Commerce Department's 1994 Industrial Outlook,

chemical and allied product shipments (SIC 28) in 1993 were valued at

$311 billion, imports $28 billion, and exports $43 billion. This is the

United States' largest exporting sector, and it has maintained a

positive trade balance during the last decade.

Because many of the chemicals covered by the CWC have legitimate

commercial applications, the Convention will have a far-reaching impact

on U.S. industry. For example, thiodiglycol (TDG) is commonly used to

manufacture ink for ball-point pens. However, it is also a precursor

for the blistering agent mustard. Likewise, trimethyl phosphite is

widely used to develop insecticides--it is also a precursor for some

nerve agents. Therefore, the production, shipment, use and in some

cases storage of such chemicals will be subject to CWC monitoring,

affecting up to an estimated 6000 U.S. facilities involved in these

activities.

In order to ensure strict compliance with its provisions, the CWC

specifies an extensive reporting and international inspection regime

for facilities, including civil industries that produce, and in some

cases process or consume, chemicals that could be used in weapons

programs. It should be noted that the CWC includes extensive

confidentiality provisions intended to protect the confidential

business information of companies that are subject to the reporting and

inspection requirements of the CWC.

As noted above, BXA estimates that CWC reporting requirements may

apply to thousands of commercial chemical facilities. In addition,

facilities that produce, and in some cases process or consume,

specified quantities of CWC-related chemicals will be subject to

routine on-site inspections conducted by international inspectors. The

Convention also provides for challenge on-site inspections, which may

be conducted at any public or private location at the request of

another country when there is legitimate concern about activities that

may be in violation of CWC provisions.

The reports and inspections will be ``site'' based. The large

chemical companies that have dozens of reportable production and

storage sites will be required to submit CWC-required information on

each site. Reporting and inspection requirements will be extensive

because companies that currently manufacture chemicals that are not

considered toxic may have the flexibility to switch production to the

more lethal varieties.

In addition to reporting and inspection requirements, the CWC also

includes production limits on Schedule I chemicals as well as

restrictions on trade in all Scheduled chemicals to ensure that the

chemicals are used only for certain activities not prohibited by the

Convention.

The CWC also requires that upon its entry into force, each country

that ratifies the Convention adopt the necessary measures to implement

its obligations. These include the establishment of a National

Authority to oversee compliance with the CWC, and enactment of

implementing legislation with penalties for noncompliance. Accordingly,

the Clinton Administration has submitted both the treaty and the

related implementing legislation to the Congress for consideration.

It should be noted that the treaty will not enter into force until

180 days after the 65th nation ratifies. Reports are due to the

international organization 30 days thereafter, however U.S. industry

will need to submit its reports in advance of entry into force to

ensure the U.S. will be in compliance with its international

obligations.

The Bureau of Export Administration (BXA) is therefore providing

advance notice that it will begin drafting regulations to specify the

requirements of the CWC. Because of the potential impact the Convention

will have on U.S. industry, BXA is requesting comments from industry

and interested public before it begins drafting regulations. Upon

receipt and review of comments, BXA will draft regulations and publish

them in the Federal Register.

BXA intends that all information obtained from the public in

connection with this notice be a matter of public record. Comments

received will be available for public inspection and copying. BXA will

not accept submissions made on a confidential basis. Communications

between agencies of the United States Government or with foreign

governments will not be made available for public inspection.

In the interest of accuracy and completeness, BXA requires written

comments. Oral comments must be followed by written memoranda, which

will also be a matter of public record and will be available for public

review and copying.

The public record concerning these comments will be maintained in

the Freedom of Information Records Inspection Facility, room 4525, U.S.

Department of Commerce, 14th Street and Pennsylvania Avenue, NW.,

Washington, DC 20230. Records in this facility, including written

public comments and memoranda summarizing the substance of oral

communications, may be inspected and copied in accordance with

regulations published in part 4 of title 15 of the Code of Federal

Regulations. Information about inspection and copying of records at

this facility may be obtained from Margaret Cornejo, BXA Freedom of

Information Officer, at the above address or by calling (202) 482-5653.

Dated: December 20, 1994.

Iain S. Baird,

Deputy Assistant Secretary for Export Administration.

[FR Doc. 94-31622 Filed 12-22-94; 8:45 am]

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