Establishment of New General License for Shipments to Country Groups QWY and the People's Republic of China

DEPARTMENT OF COMMERCE

Bureau of Export Administration

15 CFR Parts 771 and 774

[Docket No. 940392-4092]

RIN 0694-AA97

Establishment of New General License for Shipments to Country

Groups QWY and the People's Republic of China

AGENCY: Bureau of Export Administration, Commerce.

ACTION: Final rule.

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SUMMARY: The Coordinating Committee for Multilateral Export Controls

(COCOM) has agreed to cease functioning on March 31, 1994. The current

control lists will be retained by the member nations until a successor

regime is established. To help make the transition, the United States

is establishing a new General License GLX, which will allow certain

shipments to civil end-users and end-uses in formerly proscribed

destinations. This new general license will reduce paperwork and

licensing delays for exporters, and will focus controls on exports that

are of direct strategic concern.

EFFECTIVE DATE: This rule is effective April 4, 1994.

FOR FURTHER INFORMATION CONTACT: Patricia Muldonian, Office of

Technology and Policy Analysis, Bureau of Export Administration, U.S.

Department of Commerce, Telephone: (202) 482-2440.

SUPPLEMENTARY INFORMATION:

Background

The international security environment has changed in the past few

years. As a result, the United States and our COCOM partners are

revamping approaches to export controls to deal with the new challenges

of the Post-Cold War era. In this regard, the members of COCOM agreed

to end the Cold War regime on March 31, 1994, and to work together to

establish a new arrangement aimed at enhancing transparency and

restraint in arms sales and transfer of sensitive technology to

countries and regions of concern.

As these discussions progress, the members of COCOM have agreed to

retain the current COCOM Lists and the COCOM secretariat until a new

successor regime with its own control list and institutional support is

established. However, the members have also agreed to modify former

COCOM export licensing procedures by making all licensing decisions

subject to national discretion.

Accordingly, the United States is establishing a new General

License GLX for shipments to formerly COCOM proscribed destinations of

many items that previously required an Individual Validated License.

With certain important exceptions and additions noted in this

regulation, the new GLX general license will be available for the items

previously covered by Administrative Exception Notes in the Commerce

Control List.

Finally, General License GFW is revised to permit export to

eligible countries of those commodities that can be shipped to QWY and

the PRC under GLX but have not been eligible for GFW.

The United States will continue to work with the other former COCOM

member countries to coordinate transitional licensing policies and

procedures and to establish the new arrangement. As these efforts

progress, there will be additional modifications to U.S. export

licensing requirements.

Rulemaking Requirements

1. This final rule has been determined to be significant for

purposes of Executive Order 12866.

2. This rule involves a collection of information subject to the

Paperwork Reduction Act of 1980 (44 U.S.C. 3501 et seq.). This

collection has been approved by the Office of Management and Budget

under control numbers 0694-0005, 0694-0007, and 0694-0010. Licensing

requirements will be reduced as a result of this rule, thereby reducing

the paperwork burden on the public.

3. This rule does not contain policies with Federalism implications

sufficient to warrant preparation of a Federalism assessment under

Executive Order 12612.

4. Because a notice of proposed rulemaking and an opportunity for

public comment are not required to be given for this rule by section

553 of the Administrative Procedure Act (5 U.S.C. 553) or by any other

law, under section 3(a) of the Regulatory Flexibility Act (5 U.S.C.

603(a) and 604(a)) no initial or final Regulatory Flexibility Analysis

has to be or will be prepared.

5. The provisions of the Administrative Procedure Act, 5 U.S.C.

553, requiring notice of proposed rulemaking, the opportunity for

public participation, and a delay in effective date, are inapplicable

because this regulation involves a foreign and military affairs

function of the United States. This rule does not impose a new control.

No other law requires that a notice of proposed rulemaking and an

opportunity for public comment be given for this rule.

Accordingly, it is issued in final form. However, comments from the

public are always welcome. Comments should be submitted to Patricia

Muldonian, Office of Technology and Policy Analysis, Bureau of Export

Administration, Department of Commerce, P.O. Box 273, Washington, DC

20044.

List of Subjects in 15 CFR Parts 771 and 774

Exports, Reporting and recordkeeping requirements.

Accordingly, parts 771 and 774 of the Export Administration

Regulations (15 CFR parts 730-799) are amended as follows:

1. The authority citations for 15 CFR parts 771 and 774 continue to

read as follows:

Authority: Pub. L. 90-351, 82 Stat. 197 (18 U.S.C. 2510 et

seq.), as amended; sec. 101, Pub. L. 93-153, 87 Stat. 576 (30 U.S.C.

185), as amended; sec. 103, Pub. L. 94-163, 89 Stat. 877 (42 U.S.C.

6212, as amended; secs. 210 and 201(11)(e), Pub. L. 94-258, 90 Stat.

309 (10 U.S.C. 7420 and 7430(e)), as amended; Pub. L. 95-223, 91

Stat. 1626 (50 U.S.C. 1701 et seq.); Pub. L. 95-242, 92 Stat. 120

(22 U.S.C. 3201 et seq. and 42 U.S.C. 2139a); sec. 208, Pub. L. 95-

372, 92 Stat. 668 (43 U.S.C. 1354); Pub. L. 96-72, 93 Stat. 503 (50

U.S.C. app. 2401 et seq.), as amended (extended by Pub. L. 103-10,

107 Stat. 40); sec. 125, Pub. L. 99-64, 99 Stat. 156 (46 U.S.C.

466c); E.O. 11912 of April 13, 1976 (41 FR 15825, April 15, 1976);

E.O. 12002 of July 7, 1977 (42 FR 35623, July 7, 1977), as amended;

E.O. 12058 of May 11, 1978 (43 FR 20947, May 16, 1978); E.O. 12214

of May 2, 1980 (45 FR 29783, May 6, 1980); E.O. 12735 of November

16, 1990 (55 FR 48587, November 20, 1990) as continued by Notice of

November 12, 1993 (58 FR 60361, November 15, 1993); E.O. 12867 of

September 30, 1993 (58 FR 51749, October 4, 1993); and E.O. 12868 of

September 30, 1993 (58 FR 51749, October 4, 1993).

PART 771--[AMENDED]

2. Section 771.20, formerly reserved, is revised to read as

follows:

Sec. 771.20 General License GLX; exports to Country Groups QWY and the

People's Republic of China.

(a) Scope. A general license designated GLX is established,

authorizing exports to civil end-users in Country Group QWY and the

People's Republic of China (PRC) of certain specified items.

(b) Eligible exports. The items eligible for this general license

are those described in the Advisory Notes in the CCL that indicate

likelihood of approval for ``Country Groups QWY and the PRC,'' except

items described in the notes to ECCNs 1C18A and 2B18A. Likelihood of

approval notes that apply only to the PRC, or to specified destinations

in Country Group Y, also qualify for this general license to all

eligible destinations (however, those notes indicating Country Group Q

or W, but not Y, or individual countries in Q or W, are specifically

not eligible). In addition, those entries and sub-entries listed in

Supplement No. 1 to this Part 771 are eligible for export under this

general license. However, this general license is not available for

items that are also subject to missile technology (MT), nuclear

nonproliferation (NP), or foreign policy (FP) controls to the recipient

country.

(c) Eligible consignees. This general license is available only for

exports to civil end-users for civil end-uses. Exports under this

general license may not be made to military end-users or to known

military uses. Such exports will continue to require an individual

validated license and be considered on a case-by-case basis. In

addition to conventional military activities, military uses include any

proliferation activities described in Part 778 of this subchapter.

Retransfers to military end-users or end-uses in eligible countries are

strictly prohibited without prior authorization.

3. Sec. 771.23 is amended by adding a new sentence after the fifth

sentence to paragraph (c) to read as follows:

Sec. 771.23 General License GFW.

* * * * *

(c) * * * In addition, GFW may be used to export to eligible

countries any commodities (but not software or technology) listed in

Supplement No. 1 to this part 771 as eligible for General License GLX.

* * *

* * * * *

Supplement No. 1 to Part 771 [Amended]

4. Supplement No. 1 to part 771, formerly reserved, is revised to

read as follows:

Supplement No. 1--Additional Items Eligible for General License GLX

Note: Portions of some items listed in this Supplement are

controlled for missile technology (MT), nuclear proliferation (NP),

or foreign policy (FP) reasons. Exporters are reminded that such

portions are not eligible for General License GLX. Refer to the

specific ECCNs to identify those portions of entries subject to MT,

NP, or FP controls.

CATEGORY 1

1D01A

1D02A

CATEGORY 2

2A01A

2A02A

2A03A

2A04A

2A06A

2B03A.a

CATEGORY 3

3A02A.h

CATEGORY 4

4A03A.c (having a CTP of 1,000 MTOPS or less)

4A03A.h (having a 3-D vector rate less than 3M vectors/sec.)

4A03A.k

4B01A

4B02A

4B03A

4C01A

CATEGORY 5

5A02A (except .h and .i)

5A03A

5A04A

5A05A

5A06A

5B01A

5B02A

5C01A

5D01A

5D02A

5D03A

CATEGORY 6

6A01A.b

6A02A.a.4

6A03A.a.1

6A04A.f

6A05A.c.2.a

6A05A.d

6A05A.e

6B05A

6A08A.b

6A08A.c

6A08A.l.1

6C02A.c

6C04A.h

6D03A.d

CATEGORY 8

8A02A.e.2

CATEGORY 9

9B01A.a

9B01A.b

9B01A.f

9B01A.h

9B05A

9B06A

PART 774--[AMENDED]

5. Section 774.2 is amended by adding a new paragraph (o) to read

as follows:

Sec. 774.2 Permissive reexports.\2\

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\2\See Sec. 774.9 for effect on foreign laws.

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* * * * *

(o) Reexports to or among destinations in Country Groups QWY and

the People's Republic of China of items that may be exported directly

from the United States to those destinations under General License GLX.

Reexporters are specifically cautioned that GLX does not permit export

or retransfer to military end-users or military end-uses.

Dated: March 30, 1994.

Iain S. Baird,

Deputy Assistant Secretary for Export Administration.

[FR Doc. 94-7936 Filed 3-30-94; 1:02 pm]

BILLING CODE 3510-DT-P