Revisions to the Export Administration Regulations; Conforming Revisions to the Wassenaar Arrangement List of Dual-Use Items and Revisions to Antiterrorism Controls

Federal RegisterAug 7, 1998

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DEPARTMENT OF COMMERCE

Bureau of Export Administration

15 CFR Parts 738, 740, 742, 744, 746, 748, and 752

[Docket No. 980619158-8158-01]

RIN 0694-AB35

Revisions to the Export Administration Regulations; Conforming

Revisions to the Wassenaar Arrangement List of Dual-Use Items and

Revisions to Antiterrorism Controls

AGENCY: Bureau of Export Administration, Commerce.

ACTION: Interim rule with request for comments.

-----------------------------------------------------------------------

SUMMARY: On January 15, 1998, the Bureau of Export Administration

published an interim rule implementing the Wassenaar Arrangement List

of Dual-Use Items. Implementation of the Wassenaar List resulted in a

number of changes to the Commerce Control List (CCL). The major changes

involved the removal of national security controls on certain items,

while maintaining controls on these items for antiterrorism reasons.

Consistent with this revision, various antiterrorism Export Control

Classification Numbers (ECCNs) were enlarged to accommodate the items

removed from national security controls. An easy-to-follow pattern was

developed to track the movement of these items. Items formerly

classified as a XX001 entry, now default into a xx991 entry. In

addition, the January 15 rule moved items from one ECCN into another,

or merged two or more ECCNs together. This was done to simplify the CCL

and place together items that fall within the same general category.

For example, ECCN 9A992 (off-highway tractors) was merged with ECCN

9A993 (on-highway tractors) to form part of a new ECCN 9A990 that also

includes diesel engines.

This rule amends the Export Administration Regulations (EAR) by

making the necessary conforming revisions throughout the text of the

EAR, consistent with the January 15 revisions to the CCL.

[[Page 42226]]

DATES: Effective Date: This rule is effective August 7, 1998.

Comment Date: Comments on this rule must be received on or before

September 8, 1998.

ADDRESSES: Written comments should be sent to Patricia Muldonian,

Regulatory Policy Division, Bureau of Export Administration, Department

of Commerce, P.O. Box 273, Washington, DC 20044.

FOR FURTHER INFORMATION CONTACT: Patricia Muldonian, Regulatory Policy

Division, Bureau of Export Administration, Telephone: (202) 482-2440.

SUPPLEMENTARY INFORMATION:

Background

On January 15, 1998, the Bureau of Export Administration (BXA)

published an interim rule (63 FR 2452) that made changes to the

Commerce Control List (CCL) necessary to implement the Wassenaar

Arrangement. All items removed from national security controls as a

result of the Wassenaar List of Dual-Use Goods and Technologies

continue to be controlled for antiterrorism reasons. Consistent with

this revision, various antiterrorism Export Control Classification

Numbers (ECCNs) were enlarged to accommodate the items removed from

national security controls. In addition, in an effort to simplify and

harmonize the antiterrorism controls on the CCL, the January 15 rule

made the following renumbering revisions:

------------------------------------------------------------------------

Description of old

Old ECCN New ECCN ECCN

------------------------------------------------------------------------

1A988.................. 1A005.................. Bullet proof and

bullet resistant

vests.

1C993................. 1C990.................. Fibrous and

filamentary material

not controlled by

1C010 or 1C210, for

use in ``composite''

structures and with a

specific modulus of

3.18 x 106 m or

greater and a

specific tensile

strength of 7.62 x

104 m or greater.

1C994.................. 1C006.d................ Fluorocarbon

electronic cooling

fluids.

1E391.................. 1E351.................. Technology for the

disposal of chemicals

or microbiological

materials controlled

by 1C350, 1C351,

1C352, 1C353, or

1C354.

2B985.................. 0B986.................. Equipment specially

designed for

manufacturing shotgun

shells.

2B992.................. 2B996.................. Manual dimensional

inspection machines

with two or more

axes, and measurement

uncertainty equal to

or less (better) than

(3 + L/300)

micrometer in any

axes (L measured in

length in mm).

2B994.................. 2B997.................. Robots not controlled

by 2B007 or 2B207.

2D993.................. 2D991.................. Software specially

designed for the

development,

production, or use of

equipment controlled

by 2B991, 2B993 or

2B994.

2E993.................. 2E991.................. Technology for the use

of equipment

controlled by 2B991,

2B992, 2B993, or

2B994.

3A992.................. 3A991.................. Electronic devices and

components not

controlled by 3A001.

3A993.................. 3A992.a................ Electronic test

equipment, n.e.s.

3A994.................. 3A992.b/c.............. General purpose

electronic equipment

not controlled by

3A002.

3D994.................. 3D991.................. Software specially

designed for the

development,

production, or use of

electronic devices or

components controlled

by 3A992, electronic

test equipment

controlled by 3A993,

general purpose

electronic equipment

controlled by 3A994,

or manufacturing and

test equipment

controlled by 3B991.

3E994.................. 3E991.................. Technology for the

development,

production, and use

of electronic devices

controlled by 3A992.

5A990.................. 5A991.a................ Any type of

telecommunication

equipment not

controlled by

5A001.a.

5A991.................. 5A991.b................ Transmission

equipment, not

controlled by 5A001.

5A992.................. 5A991.f................ Mobile communication

equipment, n.e.s.

5A993.................. 5A991.g................ Radio relay

communications

equipment, n.e.s.

5A994.................. 5A991.c.1.............. Data message switching

equipment.

5B994.................. 5B991.................. Telecommunications

test equipment.

5D990.................. 5D991.................. Software specially

designed for the

development,

production and use of

equipment controlled

under 5A990 and

5A991.

5D992.................. 5D991.................. Software specially

designed or modified

for the development,

production, or use of

mobile communications

equipment.

5D993.................. 5D991.................. Software specially

designed or modified

for the development,

production, or use of

radio relay

communications

equipment.

5D994.................. 5D991.................. Software specially

designed or modified

for the development,

production, or use of

data (message)

switching equipment.

5E992.................. 5E991.................. Technology for the

development,

production, or use of

mobile communications

equipment.

5E993.................. 5E991.................. Technology for the

development,

production, or use of

radio relay

communications

equipment.

5E994.................. 5E991.................. Technology for the

development,

production, or use of

data (message)

switching equipment.

5A995.................. 5A992.................. Information security

equipment.

5D995.................. 5D992.................. Software n.e.s.,

specially designed or

modified for the

development,

production, or use of

information security

or cryptologic

equipment.

5E995.................. 5E991.................. Technology n.e.s., for

the development,

production, or use of

information security

or cryptologic

equipment.

6A994.................. 6A991.................. Marine or terrestrial

acoustic equipment.

6A990.................. 6A998.................. Airborne radar

equipment.

6D990.................. 6D991.................. Software specially

designed for the

development,

production, or use of

equipment controlled

by 6A990, 6A992 or

6A993.

6D994.................. 6D991.................. Software specially

designed for the

development,

production, or use of

equipment controlled

by 6A994.

6E990.................. 6E991.................. Technology for the

development,

production, or use of

equipment controlled

by 6A990, 6A992 or

6A993.

8A993.................. 8A992.h................ Self-contained under

water breathing

apparatus.

8A994.................. 8A992.f................ Boats.

8D993.................. 8D992.................. Software specially

designed or modified

for the development,

production, or use of

equipment controlled

by 8A993 and 8A994.

8E993.................. 8E992.................. Technology for the

development,

production, or use of

items controlled by

8A993 and 8A994.

9A990.................. 9A991.e................ Pressurized aircraft

breathing equipment,

n.e.s.; and specially

designed parts

therefor, n.e.s.

9A992.................. 9A990.b................ Off-highway tractors.

9A993.................. 9A990.c................ On-highway tractors.

9A994.................. 9A991.d................ Aircraft parts and

components.

[[Page 42227]]

9B994.................. 9B990.................. Vibration test

equipment.

------------------------------------------------------------------------

Although the Export Administration Act (EAA) expired on August 20,

1994, the President invoked the International Emergency Economic Powers

Act and continued in effect the EAR, and, to the extent permitted by

law, the provisions of the EAA in Executive Order 12924 of August 19,

1994, as extended by the President's notices of August 15, 1995 (60 FR

42767), August 14, 1996 (61 FR 42527) and August 13, 1997 (62 FR

43629).

Rulemaking Requirements

1. This interim rule has been determined to be not significant for

purposes of E.O. 12866.

2. Notwithstanding any other provision of law, no person is

required to respond to, nor shall any person be subject to a penalty

for failure to comply with a collection of information, subject to the

requirements of the Paperwork Reduction Act (PRA), unless that

collection of information displays a currently valid OMB Control

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

Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) This

collection has been approved by the Office of Management and Budget

under control number 0694-0088. Send comments regarding these burden

estimates or any other aspect of these collections of information,

including suggestions for reducing the burden, to OMB Desk Officer, New

Executive Office Building, Washington, DC 20503.

3. This rule does not contain policies with Federalism implications

sufficient to warrant preparation of a Federalism assessment under

Executive Order 12612.

4. 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 military and foreign affairs

function of the United States (Sec. 5 U.S.C. 553(a)(1)). Further, no

other law requires that a notice of proposed rulemaking and an

opportunity for public comment be given for this interim rule. Because

a notice of proposed rulemaking and an opportunity for public comment

are not required to be given for this rule under 5 U.S.C. or by any

other law, the analytical requirements of the Regulatory Flexibility

Act (5 U.S.C. 601 et seq. ) are not applicable.

However, because of the importance of the issues raised by these

regulations, this rule is issued in interim form and comments will be

considered in the development of final regulations. Accordingly, the

Department encourages interested persons who wish to comment to do so

at the earliest possible time to permit the fullest consideration of

their views.

The period for submission of comments will close September 8, 1998.

The Department will consider all comments received before the close of

the comment period in developing final regulations. Comments received

after the end of the comment period will be considered if possible, but

their consideration cannot be assured. The Department will not accept

public comments accompanied by a request that a part or all of the

material be treated confidentially because of its business proprietary

nature or for any other reason. The Department will return such

comments and materials to the person submitting the comments and will

not consider them in the development of final regulations. All public

comments on these regulations will be a matter of public record and

will be available for public inspection and copying. In the interest of

accuracy and completeness, the Department requires comments in written

form.

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. Communications from agencies of the United States

Government or foreign governments will not be made available for public

inspection.

The public record concerning these regulations will be maintained

in the Bureau of Export Administration Freedom of Information Records

Inspection Facility, Room 4525, Department of Commerce, 14th Street and

Pennsylvania Avenue, N.W., Washington, D.C. 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 the inspection and copying of

records at the facility may be obtained from Margaret Cornejo, Bureau

of Export Administration Freedom of Information Officer, at the above

address or by calling (202) 482-5653.

List of Subjects

15 CFR Part 738

Exports, Foreign trade.

15 CFR Parts 740, 748, and 752

Administrative practice and procedure, Exports, Foreign trade,

Reporting and recordkeeping requirements.

15 CFR Part 742

Exports, Terrorism.

15 CFR Part 744

Exports, Foreign Trade, Reporting and recordkeeping requirements.

15 CFR Part 746

Embargoes, Exports, Foreign Trade, Reporting and recordkeeping

requirements.

Accordingly, parts 738, 740, 742, 744, 746, 748, and 752 of the

Export Administration Regulations (15 CFR parts 730-799) are amended as

follows:

1-2. The authority citation for part 738 is revised to read as

follows:

Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.;

10 U.S.C. 7420, 7430(e); 18 U.S.C. 2510 et seq.; 22 U.S.C. 287c,

3201 et seq., 6004; 42 U.S.C. 2139a, 6212; 43 U.S.C. 1354; 46 U.S.C.

app. 466c; 50 U.S.C. app. 5; Sec. 201, Pub. L. 104-58, 109 Stat. 557

(30 U.S.C. 185(s), 185(u)); E.O. 12924, 3 CFR, 1994 Comp., p. 917;

E.O. 13026, 3 CFR, 1996 Comp., p. 228; Notice of August 13, 1997 (62

FR 43629, August 15, 1997).

3. The authority citation for part 740 is revised to read as

follows:

Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.;

E.O. 12924, 3 CFR, 1994 Comp., p. 917; E.O. 13020, 3 CFR, 1996 Comp.

p. 219; E.O. 13026, 3 CFR, 1996 Comp., p. 228; Notice of August 13,

1997 (62 FR 43629, August 15, 1997).

4. The authority citation for part 742 is revised to read as

follows:

Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.;

18 U.S.C. 2510 et seq.; 22 U.S.C. 3201 et seq.; 42 U.S.C. 2139a;

E.O. 12058, 43 FR 20947, 3 CFR, 1978 Comp., p. 179; E.O. 12851, 3

CFR, 1993 Comp., p. 608; E.O. 12924, 59 FR 43437, 3 CFR, 1994 Comp.,

p. 917; E.O. 12938, 3 CFR, 1994 Comp., p. 950; E.O. 13020, 3 CFR,

1996 Comp. p. 219; E.O. 13026, 3 CFR, 1996 Comp., p. 228; Notice of

August 13, 1997 (62 FR 43629, August 15, 1997).

5. The authority citation for 15 CFR part 744 is revised to read as

follows:

[[Page 42228]]

Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.;

22 U.S.C. 3201 et seq.; 42 U.S.C. 2139a; E.O. 12058, 43 FR 20947, 3

CFR, 1978 Comp., p. 179; E.O. 12851, 58 FR 33181, 3 CFR, 1993 Comp.,

p. 608; E.O. 12924, 59 FR 43437, 3 CFR, 1994 Comp., p. 917; E.O.

12938, 3 CFR, 1994 Comp., p. 950; E.O. 13026, 3 CFR, 1996 Comp., p.

228; Notice of August 13, 1997 (62 FR 43629, August 15, 1997).

6. The authority citation for 15 CFR part 746 continues to read as

follows:

Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.;

22 U.S.C. 287c, 6004; E.O. 12918, 59 FR 28205, 3 CFR, 1994 Comp., p.

899; E.O. 12924, 3 CFR, 1994 Comp., p. 917; Notice of August 13,

1997 (62 FR 43629, August 15, 1997).

7. The authority citation for 15 CFR part 748 is revised to read as

follows:

Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.;

E.O. 12924, 3 CFR, 1994 Comp., p. 917; E.O. 13026, 3 CFR, 1996

Comp., p. 228; Notice of August 13, 1997 (62 FR 43629, August 15,

1997).

8. The authority citation for 15 CFR part 752 is revised to read as

follows:

Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.;

E.O. 12924, 3 CFR, 1994 Comp., p. 917; E.O. 13020, 3 CFR, 1996 Comp.

p. 219; Notice of August 13, 1997 (62 FR 43629, August 15, 1997).

PART 738--[AMENDED]

9. Section 738.3 is amended by redesignating paragraphs (a)(2)(A)

and (a)(2)(B) as paragraphs (a)(2)(i) and (a)(2)(ii), respectively, and

by revising the heading of newly designated paragraph (a)(2)(ii) to

read as follows:

Sec. 738.3 Commerce Country Chart structure.

(a) * * *

(2) * * *

(ii) ECCNs 0A986, 0A988, 0B986, 1A005, 2A994, 2D994, and 2E994. * *

* * * * *

PART 740--[AMENDED]

10. Supplement No. 1 to Sec. 740.11 is amended:

a. By revising paragraph (a)(3); and

b. By revising paragraph (b)(3), to read as follows:

Sec. 740.11 Governments and international organizations (GOV).

* * * * *

Supplement No. 1 to Sec. 740.11--Additional Restrictions on Use of

License Exception GOV

(a) * * *

(3) Regional stability items controlled under Export Control

Classification Numbers (ECCNs) 6A002, 6A003, 6E001, 6E002, 7D001,

7E001, 7E002, 7E101, 9A018, 9D018 and 9E018 as described in 742.6(a)

of the EAR; or

* * * * *

(b) * * *

(3) Regional stability items controlled under Export Control

Classification Numbers (ECCNs) 6A002, 6A003, 6E001, 6E002, 7D001,

7E001, 7E002, 7E101, 9A018, 9D018 and 9E018 as described in 742.6(a)

of the EAR; or

* * * * *

11. Section 740.16 is amended:

a. By revising paragraph (b)(2); and

b. By revising paragraph (i), to read as follows:

Sec. 740.16 Additional permissive reexports (APR).

* * * * *

(b) * * *

(2) Commodities controlled for nuclear nonproliferation or missile

technology reasons.

* * * * *

(i) Reexports to Sudan of items controlled by ECCNs 2A994; 3A992.a;

5A991.f; 5A992; 6A991; 6A998; 7A994; 8A992.d, .e, .f, and .g; 9A990.a

and .b; and 9A991.d and .e. In addition, items in these ECCNs are not

counted as controlled U.S. content for purposes of determining license

requirements for U.S. parts, components, and materials incorporated in

foreign-made products. However, the export from the United States to

any destination with knowledge that they will be reexported directly or

indirectly, in whole or in part to Sudan is prohibited without a

license.

* * * * *

PART 742--[AMENDED]

Sec. 742.2 [Amended]

12. In Sec. 742.2, paragraphs (a)(1)(ii) and (a)(2)(iii) are

amended by revising the phrase ``(ECCNs 1E001 and 1E391)'' to read

``(ECCNs 1E001 and 1E351)''.

Sec. 742.7 [Amended]

13. Section 742.7(a)(1) is amended by revising the phrase ``6E001

(for police-model infrared viewers only), and 9A980'' to read ``6E001

(for police-model infrared viewers only), 6E002 (for police-model

infrared viewers only), and 9A980''.

14. Section 742.8 is amended by revising paragraph (a)(2) to read

as follows:

Sec. 742.8 Anti-terrorism: Iran.

(a) * * *

(2) If AT column 1 or AT column 2 of the Commerce Country Chart

(Supplement No. 1 to part 738 of the EAR) is indicated in the

appropriate ECCN, a license is required for reexport to Iran for anti-

terrorism purposes, except for ECCNs 2A994; 3A992.a; 5A991.f; 5A992;

6A991; 6A998; 7A994; 8A992.d, .e, .f, and .g; 9A990.a and .b; and

9A991.d and .e. In addition, items in these ECCNs are not counted as

controlled U.S. content for the purpose of determining license

requirements for U.S. parts, components or materials incorporated into

foreign made products. However, the export from the United States to

any destination with knowledge that they will be reexported directly or

indirectly, in whole or in part to Iran is prohibited without a

license. See paragraph (a)(5) of this section for controls maintained

by the Department of the Treasury.

* * * * *

Sec. 742.9 [Amended]

15. Section 742.9(b)(1)(iv) is amended by revising the phrase

``except for ECCNs 6A990, 7A994, and 9A994,'' to read ``except for

ECCNs 6A998, 7A994, and 9A991.d,''.

16. Section 742.10 is amended by revising paragraph (a)(2) to read

as follows:

Sec. 742.10 Anti-terrorism: Sudan.

(a) * * *

(2) If AT column 1 or AT column 2 of the Commerce Country Chart

(Supplement No. 1 to part 738 of the EAR) is indicated in the

appropriate ECCN, a license is required for reexport to Sudan for anti-