Chemical Weapons Convention Regulations

DEPARTMENT OF COMMERCE

Bureau of Export Administration

15 CFR Parts 710 through 722

[Docket No. 990611158-9311-02]

RIN 0694-AB06

Chemical Weapons Convention Regulations

AGENCY: Bureau of Export Administration, Commerce.

ACTION: Interim rule and request for comments.

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

SUMMARY: On April 25, 1997, the United States ratified the Convention

on the Prohibition of the Development, Production, Stockpiling and Use

of Chemical Weapons and on Their Destruction, also known as the

Chemical Weapons Convention (CWC or Convention). This interim rule

establishes the Chemical Weapons Convention Regulations (CWCR) to

implement provisions of the Convention affecting U.S. industry and

other U.S. persons. The CWCR include requirements to report certain

activities involving Scheduled chemicals and Unscheduled Discrete

Organic Chemicals, and to provide access for on-site verification by

international inspectors of certain facilities and locations in the

United States.

DATES: Effective Date: December 30, 1999.

Comments: Written comments must be submitted no later than January

31, 2000.

ADDRESSES: Written comments should be sent to the Regulatory Policy

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

Room 2705, 14th Street and Pennsylvania Avenue, N.W., Washington, D.C.

20230.

FOR FURTHER INFORMATION CONTACT: For questions of a general or

regulatory nature, contact the Regulatory Policy Division, telephone:

(202) 482-2440. For program information on declarations, reports,

notifications, and chemical determinations, contact the Information

Technology Team of the Treaty Compliance Division, Office of Chemical &

Biological Controls and Treaty Compliance, telephone: (703) 235-1335;

for program information on inspections and facility agreements, contact

the Inspection Management Team of the Treaty Compliance Division,

Office of Chemical & Biological Controls and Treaty Compliance,

telephone: (202) 482-6114; for legal questions, contact Cecil Hunt,

Acting Chief Counsel, Office of the Chief Counsel for Export

Administration, telephone (202) 482-5301.

SUPPLEMENTARY INFORMATION:

I. Background

Chemical Weapons Convention

On April 25, 1997, the United States ratified the Convention on the

Prohibition of the Development, Production, Stockpiling and Use of

Chemical Weapons and on Their Destruction, also known as the Chemical

Weapons Convention (CWC or Convention). The Convention, which entered

into force on April 29, 1997, is an arms control treaty with

significant non-proliferation aspects. As such, the Convention bans the

development, production, stockpiling or use of chemical weapons and

prohibits States Parties from assisting or encouraging anyone to engage

in a prohibited activity. The Convention provides for declaration and

inspection of all States Parties' chemical weapons and chemical weapon

production facilities and oversees the destruction of such weapons and

facilities.

To fulfill its arms control and non-proliferation objectives, the

Convention also establishes a comprehensive verification scheme and

requires the declaration and inspection of facilities that produce,

process or consume certain ``scheduled'' chemicals and unscheduled

discrete organic chemicals, many of which have significant commercial

applications. The Convention also requires States Parties to report

exports and imports and to impose export and import restrictions on

certain chemicals. These requirements apply to all entities under the

jurisdiction and control of States Parties, including commercial

entities and individuals. States Parties to the Convention, including

the United States, have agreed to this verification scheme to provide

transparency and to ensure that no State Party to the Convention is

engaging in prohibited activities.

Specifically, the Convention requires States Parties to declare all

facilities that produce Schedule 1 or Schedule 3 chemicals in

quantities exceeding specified declaration thresholds, or that produce,

process or consume Schedule 2 chemicals in quantities exceeding

specified declaration thresholds. Schedule 1, 2 and 3 chemicals are set

forth in the Convention's Schedules of Chemicals and have been selected

for these Schedules based on degree of toxicity, history of use in

chemical warfare and commercial utility. The Convention also requires

States Parties to declare facilities that produce ``Unscheduled

Discrete Organic Chemicals'' (``UDOCs'') in quantities exceeding

specified thresholds. The requirement to declare UDOC facilities is

intended to identify facilities capable of producing chemical warfare

agents or precursors.

Certain ``declared'' facilities will also be subject to routine on-

site inspections by international inspectors from the Convention's

implementing body, the Organization for the Prohibition of Chemical

Weapons (OPCW). All declared Schedule 1 facilities are subject to

routine inspection. Declared Schedule 2 facilities are subject to

inspection if they produce, process or consume Schedule 2 chemicals in

quantities exceeding specified inspection thresholds. Declared Schedule

3 facilities are subject to inspection if they produce Schedule 3

chemicals in quantities exceeding a specified inspection threshold.

Facilities producing UDOCs in quantities exceeding a specified

threshold will be subject to inspection beginning April 29, 2000. With

a few exceptions, inspection thresholds are higher than declaration

thresholds.

The Convention also provides for challenge inspections of any

facility or location under the jurisdiction of any State Party.

Challenge inspections are intended to resolve questions of possible

non-compliance with the Convention.

Finally, the Convention requires States Parties to provide

information on exports and imports of Scheduled chemicals. States

Parties must also, among other things, prohibit exports of Schedule 1

chemicals to non-States Parties, require advance notification of

imports and exports of Schedule 1 chemicals, require End-Use

Certificates for exports of Schedule 2 and 3 chemicals to non-States

Parties, and ban the import from or export to non-States Parties of

Schedule 2 chemicals after April 28, 2000.

Application of CWC Requirements to U.S. Commercial Entities and

Individuals

The Chemical Weapons Convention Implementation Act of 1998

(``Act'') (22 U.S.C. 6701 et seq.), enacted on October 21, 1998,

authorizes the United States to require the U.S. chemical industry and

other private entities to submit declarations, notifications and other

reports and also to provide access for on-site inspections. Executive

Order (E.O.) 13128 delegates authority to the Department of Commerce to

promulgate regulations, obtain and execute warrants, provide assistance

to certain facilities, and carry out appropriate

[[Page 73745]]

functions to implement the Convention, consistent with the Act. The

Department of Commerce will carry out CWC import restrictions under the

authority of the International Emergency Economic Powers Act, the

National Emergencies Act and E.O. 12938, as revised by E.O. 13128. The

Departments of State and Commerce are implementing CWC export

restrictions under their respective export control authorities. E.O.

13128 designates the Department of State as the United States National

Authority (USNA) for purposes of the Convention and the Act.

Other Department of State and Commerce Regulations Implementing

Requirements of the Chemical Weapons Convention

In addition to this interim rule, the Department of State is

publishing a separate rule on the taking of samples during on-site

inspections in the United States and the enforcement provisions for

violations of the reporting and inspection requirements set forth in

the Act, and also maintains the International Traffic in Arms

Regulations (ITAR) (22 CFR 120-130).

Further, on May 18, 1999, the Bureau of Export Administration (BXA)

of the Department of Commerce published an interim rule (64 FR 27138)

amending the Export Administration Regulations (15 CFR 730-799) to

implement the following trade restriction provisions of the CWC:

--Annual reporting of all exports of Schedule 1 chemicals;

--Advance notification of all exports of Schedule 1 chemicals;

--Prohibition on exports of Schedule 1 chemicals subject to

Department of Commerce jurisdiction to non-States Parties;

--Prohibition on all reexports of Schedule 1 chemicals subject to

Department of Commerce jurisdiction;

--Prohibition on exports of Schedule 2 chemicals subject to

Department of Commerce jurisdiction to non-States Parties after

April 28, 2000;

--Requirement that exporters obtain an End-Use Certificate prior to

exporting any Schedule 2 or 3 chemicals to a non-State Party; and

--License requirements for the export of Schedule 1 chemicals under

Department of Commerce jurisdiction to all destinations, including

Canada.

Note that all existing export license requirements that apply to

CWC Scheduled chemicals and UDOCs subject to Department of Commerce

jurisdiction continue in effect. Further, the new CWC reporting

requirements, such as the End-Use Certificate and prior notification

requirements, are in addition to existing export license and supporting

documentation requirements for exports of chemicals subject to

Department of Commerce or Department of State export licensing

jurisdiction.

The Chemical Weapons Convention Regulations (CWCR)

This rule implements reporting and inspection requirements and

import restrictions. The CWCR:

--Apply to all U.S. persons and to facilities in the United States,

except for facilities of the Departments of Defense and Energy and

other U.S. Government agencies that notify the United States

National Authority (USNA) of their decision to be excluded from the

CWCR (such entities are referred to as ``persons and facilities

subject to the CWCR''). United States Government facilities are

those owned by or leased to the U.S. government, including

facilities that are contractor-operated.

--Set forth the declaration and other reporting requirements that

affect persons and facilities subject to the CWCR. The reporting

requirements of this rule are consistent with the procedural

provisions of section 401(a) of the Act. Section 401(a) of the Act

requires submission to the Director of the USNA of such reports as

the USNA may reasonably require to provide to the OPCW, pursuant to

subparagraph 1(a) of the Convention's Annex on Confidentiality.

Subparagraph 1(a) of the Confidentiality Annex provides that the

OPCW shall require only the minimum amount of information and data

necessary for the timely and efficient conduct by the OPCW of its

responsibilities under the Convention. As required by Section 401(a)

of the Act, the USNA, in coordination with the CWC interagency

group, has determined that the reports required by the CWCR are

those reasonably required to be provided to the OPCW. Declarations,

notifications and other reports required under the CWCR will be due

to the Department of Commerce at specified dates or within specified

time frames for verification, aggregation and submission to the

Director of the USNA. The USNA will transmit United States

declarations, reports and notifications to the OPCW located in the

Hague, the Netherlands.

--Require access for on-site inspections.

--Prohibit imports of Schedule 2 chemicals from non-States Parties

after April 28, 2000.

--Contain recordkeeping requirements and administrative procedures

and penalties related to violations of reporting and inspection

requirements and importation restrictions.

--Implement section 211 of the Act, which authorizes revocation of

the export privileges of any person determined to have violated the

chemical weapons provisions of 18 U.S.C. Sec. 229.

Reporting Requirements

Declaration Requirements. Facilities required to submit

``declarations'' are those that produce, process or consume certain

chemicals in quantities that exceed specified thresholds. Four types of

declarations are due to BXA when required by parts 712 through 715 of

the CWCR: initial declarations, annual declarations on past activities,

annual declarations on anticipated activities, and a one-time

declaration of facilities that produced Schedule 2 or 3 chemicals for

chemical weapons purposes at any time since January 1, 1946. The United

States will transmit data on declared facilities to the OPCW. Such data

will also be compiled to establish the U.S. national aggregate on

production, processing and consumption of relevant chemicals. Export

and import data contained in declarations will also be compiled and

added to export and import information obtained from other reports to

establish the U.S. national aggregate declaration on imports and

exports of certain chemicals.

Initial declarations. Initial declarations are one-time

declarations that are due to BXA BY March 30, 2000, except for the

establishment of new Schedule 1 facilities, which requires submission

of a technical description of the facility prior to producing above 100

grams aggregate. Any Schedule 2 or 3, or UDOC plant site that was not

required to submit an initial declaration but that exceeded the

applicable declaration or reporting thresholds for covered activities

in a subsequent year, must submit only an annual declaration on past

activities or an annual report on exports and imports. Facilities that

produced more than 100 grams aggregate of Schedule 1 chemicals in

calendar year 1997, 1998, or 1999 must submit an initial declaration (a

technical description of the facilities). Note that the Schedule 1

Certification Form asks you to identify each year in which you produced

in excess of 100 grams aggregate. Facilities that produced, processed

or consumed more than specified quantities of a Schedule 2 chemical in

any of the calendar years 1994, 1995, or 1996 must provide information

on activities involving that Schedule 2 chemical that occurred in each

of calendar years 1994, 1995, and 1996. Facilities that produced more

than 30 metric tons of a Schedule 3 chemical in calendar year 1996 must

provide information on activities involving this Schedule 3 chemical

that occurred in 1996. Facilities that produced more than specified

quantities of UDOCs in calendar year 1996 must provide ranges of

production for 1996.

Annual declarations on past activities. Facilities that produced

more than 100 grams aggregate of Schedule 1 chemicals, more than 30

metric tons of a Schedule 3 chemical, or more than

[[Page 73746]]

specified quantities of UDOCs in the previous calendar year, must

submit an annual declaration on past activities. Facilities that

produced, processed or consumed more than specified quantities of a

Schedule 2 chemical in any of the three previous calendar years must

submit an annual declaration on past activities for activities during

the previous year. Annual declarations on past activities for calendar

years 1997, 1998, and 1999 will be due to BXA March 30, 2000.

Annual declarations on anticipated activities and declarations on

additionally planned activities. Facilities that anticipate engaging in

production of Schedule 1 or Schedule 3 chemicals or production,

processing or consumption of Schedule 2 chemicals above specified

thresholds during the next calendar year must submit an annual

declaration on anticipated activities. Facilities that have certain

types of changes or additions to their annual declaration on

anticipated activities must submit a declaration on additionally

planned activities.

One time declaration of past production for chemical weapons

purposes. Facilities that have produced Schedule 2 or Schedule 3

chemicals anytime since January 1, 1946, for chemical weapons purposes

must submit a declaration by March 30, 2000.

Amended declarations and reports. The CWCR also provide for

submission of ``amended declarations'' and ``amended reports'' to

change, replace, or add information to previously submitted

declarations or reports.

Notification Requirements. Facilities that intend to export or

import Schedule 1 chemicals to or from States Parties must submit prior

notifications of these activities. These notifications will be

forwarded to the OPCW.

Other Reporting Requirements. U.S. persons and facilities subject

to the CWCR that have exported or imported a scheduled chemical, but

have not produced, processed, or consumed declarable quantities of that

chemical, may nevertheless have an export or import reporting

requirement. The USNA will NOT forward facility-specific information

contained in these reports to the OPCW. BXA will include the export and

import data in the compilation of the U.S. national aggregate

declaration on exports and imports of relevant chemicals.

Initial reports on exports and imports. Initial reports for exports

and imports are required for exports and imports of Schedule 2 and

Schedule 3 chemicals above certain threshold quantities during calendar

year 1996.

Annual reports on exports and imports. Annual reports for exports

and imports are required for all exports and imports of Schedule 1

chemicals during the previous calendar year, and for exports and

imports of Schedule 2 and 3 chemicals above certain threshold

quantities. Annual reports on exports and imports for calendar years

1997, 1998, and 1999 will be due to BXA March 30, 2000.

Timing of submission of initial and annual declarations and

reports. The first declaration and report package due to the Department

of Commerce will include the initial declaration plus the annual

declarations and reports for activities in calendar years 1997, 1998,

and 1999. The first Schedule 1 annual declaration on anticipated

activities for calendar year 2001 will be due to BXA on August 3, 2000.

The first Schedule 2 and Schedule 3 annual declarations on anticipated

activities for calendar year 2001 will be due on September 3, 2000.

Certain facilities may also need to submit the one-time declaration on

past production of Schedule 2 or Schedule 3 chemicals for chemical

weapons purposes. CWC Declaration and Report Handbooks containing

necessary multipurpose forms for declarations and reports will be

available by mail and through the Internet. If there are discrepancies

between the CWCR and the Handbooks (including instructions and form

requirements), the CWCR prevail.

On-Site Inspection Requirements

This rule also sets forth the requirements and procedures for on-

site inspections of U.S. facilities subject to the CWCR, consistent

with sections 301 to 309 of the Act. On-site inspections will be

conducted by inspectors from the OPCW's Technical Secretariat. The

Department of Commerce will lead the Host Team accompanying and

escorting the inspectors during inspections.

Types of inspections. There are two major kinds of inspections: (1)

Initial and subsequent (``routine,'' under the Act) inspections of

declared facilities whose level of production, processing or

consumption of specified chemicals makes them subject to such

verification as a routine matter; and (2) ``challenge'' inspections of

any facility or location in the United States based on a request made

by another State Party to clarify and resolve any questions concerning

possible non-compliance with the Convention.

Notification and consent procedures. Pursuant to section 304 of the

Act, before an inspection may take place, the USNA must authorize each

inspection of a facility or location in the United States and provide

actual written notification of each inspection to the owner and

operator or other person in charge of the facility. For routine

inspections of declared facilities, the USNA will provide such written

notification within 6 hours of receiving notification from the OPCW

Technical Secretariat or as soon as possible thereafter. The Department

of Commerce will provide Host Team notice to facilities to be

inspected. The Department of Commerce intends to seek an administrative

warrant, as provided for by section 305 of the Act and in E.O. 13128,

if the owner or person in charge of the facility does not consent to

the inspection.

II. Public Comments on Proposed Rule

On July 21, 1999, the Bureau of Export Administration published in

the Federal Register (64 FR 39104) a proposed rule, with request for

comment, to establish the Chemical Weapons Convention Regulations

(CWCR) to implement provisions of the Convention and the Act affecting

U.S. industry and other U.S. persons. BXA received comments from 18

respondents. Following is a summary of those comments, along with BXA's

responses.

Scope of the CWCR

One respondent questioned whether the definition of ``Chemical

Weapons Convention'' includes any annexes that have not yet entered

into force under the Convention, and stated that annexes approved after

January 13, 1993, should not automatically be implemented by the CWCR.

This rule implements those relevant articles and annexes of the

Convention that entered into force on April 29, 1997, as reflected in

parts 710 through 722 of the CWCR.

To clarify what U.S. government facilities are excluded from the

CWCR, one respondent sought guidance on whether the term ``U.S.

facilities that are contractor-operated'' includes facilities owned by

the U.S. Government, but leased to private companies. The CWCR

reporting, declaration, and inspection requirements do apply to

facilities owned by a U.S. Government agency and leased to a private

company or other entity, such that the private company or other entity

may independently decide for what purposes to use the facilities. BXA

has revised Sec. 710.2 of this rule to clarify the scope of the CWCR.

Chemicals Subject to the CWCR

One respondent requested that all Schedule 1, Schedule 2 and

Schedule 3 chemicals subject to the CWCR be

[[Page 73747]]

identified by the Chemical Abstract Service registry number (CAS

number) to clarify declaration and reporting requirements. Supplement

No. 1 to Part 712 (Schedule 1), Supplement No. 1 to Part 713 (Schedule

2), and Supplement No. 1 to Part 714 (Schedule 3) of the CWCR list

certain chemicals by name or family that are subject to the CWCR. These

Supplements also identify certain of these chemicals by CAS number.

These Supplements mirror the Schedules of Chemicals found in the

Convention. BXA agrees that it is desirable to provide CAS registry

numbers for all chemicals subject to the CWCR. However, because there

are, by conservative estimates, 25,000 or more chemicals subject to the

CWCR, listing each chemical by name and CAS number is not practical. In

addition, new chemicals are being developed and/or assigned CAS numbers

daily. Therefore, any list published by BXA would be neither exhaustive

nor current. BXA believes that Supplement No. 1 to Parts 712, 713 and

714 of the CWCR provide sufficient information for a qualified chemist

to determine whether a chemical is subject to the CWCR. In addition,

BXA will, upon request, provide a binding determination of whether or

not a specific chemical is subject to the CWCR. (See Sec. 711.3 of the

CWCR.)

Confidential Business Information

Four respondents submitted comments on confidential business

information (CBI) issues, which fall into four broad categories: the

amount of information BXA should collect; location and consolidation of

CBI provisions in the CWCR; protection of information made available to

the OPCW; and protection of CBI within the United States in both

Freedom of Information Act (FOIA) and non-FOIA contexts.

Amount of information BXA should collect: Two respondents requested

BXA to collect only the minimum amount of information necessary to

comply with the Convention and the Act. Consistent with section 401 of

the Act, the U.S. Government is requiring only the minimal information

necessary to satisfy the requirements of the Convention and Act. This

is reflected in the provisions of the CWCR.

One respondent suggested that BXA not make lists of companies

subject to CWC verification, for fear that such lists could be

exploited by persons seeking to stigmatize the lawful production of

chemicals. The respondent suggested if BXA did establish such lists,

that BXA implement procedures for removing facilities from those lists

when such facilities are no longer subject to declaration requirements.

From time to time, BXA will need to create such lists, for example, to

comply with certain U.S. national declaration requirements. However,

BXA will create the minimum number of lists necessary, and will update

the lists as appropriate, to ensure effective U.S. implementation of

the Convention.

One respondent was concerned that language in the proposed rule on

the conduct of inspections would not allow the site representative to

shroud or remove from the site items that the site representative

determined were irrelevant to the inspection, unless ``agreed by the

U.S. Government Team.'' The respondent suggested deletion of the cited

phrase. BXA has clarified this provision by changing it to read ``as

determined by the Host Team,'' since the right to take protective

measures, such as shrouding equipment not related to the purpose of an

inspection, is a right granted to the State Party under the Convention.

Consolidation and location of CBI provisions in the CWCR: One

respondent suggested consolidating the CBI provisions in Part 716

(routine inspections) and Part 717 (challenge inspections). Three

respondents requested BXA to consolidate all provisions in the CWCR

relating to CBI and place these consolidated provisions in part 710 to

highlight their importance. BXA agrees that to avoid any ambiguity that

may arise because of slight differences in wording, the CBI provisions

should be consolidated. To highlight the importance of CBI, BXA is

placing these provisions in a dedicated CBI part. Because part 710

serves as an introduction to the CWCR and does not have regulatory

force, BXA is placing the CBI provisions in Part 718, entitled

``Confidential Business Information.'' BXA is creating new part 722,

entitled ``Interpretations,'' to replace Part 718, originally reserved

for interpretations.

Status of information made available to the OPCW: Three respondents

suggested that all CBI made available to the OPCW during inspections be

designated ``highly protected.'' The Convention provides that States

Parties may designate information submitted to the Technical

Secretariat as confidential, and requires the OPCW to limit access to,

and prevent disclosure of, information so designated, except that the

OPCW may disclose certain confidential information submitted in

declarations to other States Parties if requested. The OPCW has

developed a classification system whereby States Parties may designate

their declarations as ``restricted,'' ``protected,'' or ``highly

protected.'' The U.S. Government is directing the OPCW to accord

``protected'' status to all information contained in declarations,

reports and advance notifications of exports and imports of Schedule 1

chemicals. The ``protected'' level of confidentiality is consistent

with the level of protection designated by many other States Parties

for their industrial declarations.

It is also the policy of the U.S. Government to designate CBI that

it discloses to OPCW Inspection Teams as ``protected'' or ``highly

protected,'' depending on the sensitivity of the information. However,

the U.S. Government will not request ``protected'' status for

information made available to OPCW Inspection Teams that is publicly

available, such as company sales or marketing literature or information

from the company's Internet web site. The ``protected'' or ``highly

protected'' status will apply to CBI disclosed to Inspection Teams,

irrespective of the form or medium in which it is made available to the

OPCW, whether in oral, written or visual form.

Definition and identification of CBI: Three respondents requested

clarification about the ``scope of coverage'' of CBI in the CWCR.

Section 103(g) of the Act defines U.S. confidential business

information as any trade secrets or commercial or financial information

that is privileged and confidential. BXA has determined that CBI

contained in information submitted to, or obtained by, the U.S.

Government for CWC purposes will fall into one of two categories:

(1) information that falls under the types of information listed

in Section 103(g)(1) of the Act, called ``section 103(g)(1)

information''; and

(2) information that does not meet (1) but that meets all the

criteria of section 103(g)(2) of the Act because it is a ``trade

secret'' as described in 5 U.S.C. 552(b)(4) and is obtained from a

U.S. person or through the U.S. Government or the conduct of an

inspection in the United States, called ``section 103(g)(2)

information.''

Information that satisfies the criteria of both sections 103(g)(1)

and 103(g)(2) will be treated as section 103(g)(1) information.

BXA has determined that certain fields in the declaration and

report forms meet the definition of section 103(g)(1) and has

identified these fields in Supplement 1 to Part 718 of the CWCR. BXA

will continue to determine whether additional types of information meet

the requirements of section 103(g)(1) and will add to Part 718 any such

types of information that can apply generally to entities subject to

the CWCR. Section 103(g)(2) information

[[Page 73748]]

will likely involve specific circumstances, require case-by-case

determination, and not lend itself to general use. Therefore, BXA

cannot at this time provide additional clarification about the scope of

coverage of section 103(g)(2).

Except for the section 103(g)(1) information BXA has identified in

the declaration and report forms, the U.S. Government will not be able

to distinguish CBI from non-CBI, as defined in the Act, and will

require the assistance of industry in identifying such CBI, most

notably in connection with inspections.

Two respondents objected to the implicit limitation of the scope of

CBI in Supplement No. 1 to Part 711 of the proposed rule. BXA intends

this chart to serve as general guidance by indicating the fields of

information on declaration and report forms that BXA has identified as

section 103(g)(1) information. BXA is revising the supplement (to new

part 718) to add a note indicating that information in other fields on

the forms may also be considered CBI when such information has been

specifically identified by submitters and a rationale has been provided

for the CBI status of such information.

In a related matter, two respondents urged BXA to indicate that CBI

need not be ``marked,'' but one respondent recommended that items not

specifically identified in 103(g)(1) be marked. This rule requires

companies to identify information they consider to be CBI that BXA has

not specifically identified in Supplement No. 1 to Part 718 as section

103(g)(1) information. In addition, entities hosting on-site

inspections will need to specifically identify to the Host Team any CBI

contained in information made available to the U.S. Government to

ensure proper handling and treatment of such CBI.

One respondent requested BXA to provide a box on the declaration/

reporting forms so a company could check the box to indicate the form

contained CBI. Checking a box would not serve to specifically identify

the information on the completed form that meets the definition of CBI.

BXA must reject this suggestion and require the system of

identification set out in this preamble and in this rule.

One respondent asked BXA to state that all information provided to

the U.S. Government for whatever purpose is confidential when it meets

the CBI definition of the Act. The Act defines CBI, not for all

purposes, but for specific purposes. BXA is unable to comply with this

request. Certain data defined as CBI in a CWC compliance context might

not qualify as a ``trade secret'' or otherwise be deemed confidential

when obtained by the U.S. Government in non-CWC compliance contexts

(e.g., publicly available research, patent, or sales data).

One respondent urged BXA to acknowledge that CBI would arise in a

variety of contexts. BXA agrees that CBI will exist in tangible and

intangible forms. BXA believes that Part 718 adequately covers CBI.

Protection of CBI by the U.S. Government in non-FOIA contexts: All

four respondents expressed concern about U.S. Government protection of

CBI in situations other than requests for information under the Freedom

of Information Act (FOIA), such as Department of State and Commerce

enforcement proceedings or litigation in which the U.S. Government is

not a party. Three respondents requested BXA to draft CBI provisions in

this regulation as a broad, blanket non-disclosure requirement, except

where expressly permitted by section 404 of the Act (i.e., to the OPCW,

U.S. law enforcement agencies, and appropriate congressional

committees).

Section 404 of the Act provides exemptions from the disclosure

requirements of FOIA. BXA cannot guarantee non-disclosure of

information in all circumstances, such as in instances of judge-issued

subpoenas. Information and documents related to CWC administrative

enforcement cases will be handled and protected according to procedures

set forth in part 719 of the CWCR.

In a related issue, three respondents requested BXA to specify that

the Act is a ``confidentiality statute'' for purposes of regulations

administered by the Office of the Secretary of Commerce in 15 CFR Part

15 (Legal Proceedings). Part 15 sets forth procedures governing the

production of Department of Commerce records or testimony by Department

of Commerce employees in legal proceedings in which the United States

is not a party. Federal agencies may establish such procedures under

section 301 of Title 5, United States Code, to provide for the custody,

use and preservation of its records. BXA has determined that it is

unnecessary to specify whether the provisions of the Act fall under the

meaning of ``confidentiality statute,'' as used in 15 CFR section 15.17

because this, in and of itself, does not provide any protection other

than that already available under the Act and other statutes. The

Departmental regulations do not enhance existing statutory protections,

but merely provide a mechanism whereby the Department can determine

whether any evidentiary privileges or statutory requirements of privacy

or confidentiality apply, or if there is any other legal basis for

withholding information.

One respondent stated that the U.S. Government should request the

United States magistrate judge to seal all records of warrants

proceedings in order to guard against public disclosure of any CBI

contained in the warrant or in material submitted in support of the

issuance of the warrant. BXA intends to request that warrant

proceedings be sealed if the warrant or related material includes CBI.

Protection of CBI requested under the Freedom of Information Act:

Section 404 of the Act does not provide a statutory exemption from FOIA

disclosure requirements for all information that is reported to, or

otherwise obtained by, the U.S. Government, but only for ``certain

Convention information'' (i.e., that which is defined as ``confidential

business information'' in section 103(g) of the Act). BXA will withhold

from disclosure pursuant to a FOIA request only CBI, as defined in

section 103(g), that has either been identified by BXA or by the person

from whom the information is obtained.

National Interest Determination: Two respondents requested BXA to

narrowly define the term ``national interest,'' or to provide factors

that the U.S. Government would consider in determining disclosure under

the national interest disclosure provision. BXA cannot provide a

definitive list of factors, since these would depend on specific

circumstances, could change over time, and would need the concurrence

of other agencies.

Two respondents suggested specific language for the consolidated

CBI provisions, building upon language in the proposed rule. BXA is

adopting some, but not all, the provisions in the suggested text. Under

the suggested text, the notification and hearing procedures that apply

to CBI disclosed in the ``national interest'' would also apply to

disclosures to appropriate committees of Congress and law enforcement

agencies. BXA rejects this suggestion. The Act does not require such

notice and hearing procedures in the latter cases and provides no

discretion regarding disclosure to such entities. Application of these

procedures would only serve to delay authorized disclosures, without

affecting the outcome. Moreover, delay in disclosure to other law

enforcement agencies could hamper the actions of such law enforcement

agencies, thereby thwarting the intention of the statute. BXA notes,

however, that section 404 of the Act contains provisions limiting

[[Page 73749]]

further disclosure by such Congressional committees and law enforcement

agencies of CBI released to them.

Recordkeeping

One respondent requested clarification on whether the declaration

responsibilities for the production of Schedule 2 and 3 chemicals for

chemical weapons purposes at any time since January 1, 1946 reside with

the company that originally may have produced the chemicals. Four

respondents addressed the proposed rule's requirement that the facility

prepare declarations for activities dating back to 1994. The

respondents state that the records and information necessary to prepare

declarations may not be available because: (1) necessary information

was not collected at the time of the activity, since no regulatory

requirement to do so was in effect; (2) if collected at the time of the

activity, the information has been discarded following normal business

practices; or (3) due to changes in ownership or control of a facility,

the current custodian of the information may no longer be affiliated

with a facility subject to the CWCR. One respondent referenced a

Supreme Court ruling which states that legislative rules, such as the

CWCR, may not have a retroactive effect unless explicitly provided for

by statute. The respondents request that BXA acknowledge that

information necessary to prepare declarations or reports for previous

years may not be available and that failure to prepare and submit

declarations or reports for this reason should not constitute a

violation under the CWCR.

BXA agrees that if records necessary to prepare a declaration and

report are not available because one or more of the three factors cited

in the preceding paragraph took place prior to the effective date of

this rule, failure to prepare and submit the declaration or report

should not constitute a violation under the CWCR. However, BXA has the

authority under the Act to require the preparation and submission of a

declaration or report for activities that occurred before the

regulatory requirement becomes effective and, to the extent that

information necessary to prepare the declarations and reports is

available, the U.S. Government has the authority to impose an

administrative sanction for willful failure or refusal to do so. Such a

requirement is not ``retroactive'' under the Administrative Procedure

Act, because it does not alter the past legal status of a past action

(i.e., disposal of records or failure to create records). In addition,

the Technical Secretariat of the OPCW recently has confirmed that

declarations and reports for activities occurring as early as 1994 may

be useful to it in carrying out its verification and monitoring

responsibilities. This rule includes new language in Sec. 711.4 which

addresses these issues.

One respondent requested that the 5-year record retention period be

limited to 3 years. This rule maintains the 5-year requirement to

correspond with the statute of limitations applicable to enforcement

actions (28 U.S.C. 2462). Four respondents stated that part 721 was too

vague and broad, and might be interpreted as requiring documents to be

retained that are not necessary to enforcement or other administration

of the CWCR. BXA has revised part 721 to clarify the types of

documentation required to be retained, the location of documents, and

the use of copies of documents to meet the record retention

requirements. Finally, one respondent questioned the meaning of

``formal or informal'' requests for documents that would preclude their

disposal or destruction. By ``formal,'' the CWCR means a subpoena. By

``informal,'' the CWCR means a verbal or written request by the

investigating agency for a particular document or documents.

Declarations and Reports

One respondent requested an explanation of how the term ``report''

is used in the CWCR and a clearer description of the types of

information that will be submitted to the OPCW. The term ``report'' is

used to describe several different types of activities under the CWCR

and the Act. The Act refers to reports to describe all types of

requirements under the Convention, including declarations on

production, processing and consumption, as well as reports on exports

and imports. For reports required by the Act, this rule uses the

following terms: (1) declarations; (2) reports on export and import

activities; (3) notifications; (4) end-use certificates; (5) reports on

inspection-related costs; and (6) post-inspection reports. BXA submits

individual declarations for each declared facility to the USNA for

transmission to the OPCW. These declarations contain facility-specific

information, including facility name and address, and information on

production, processing, consumption, and, in certain instances, export

and import of specific chemicals. In addition, BXA submits to the USNA

a national aggregate declaration on exports and imports, which combines

information from facility declarations as well as information from

reports submitted by other facilities and trading companies. The

national aggregate declaration does not include facility-specific

information, but only aggregate information by chemical or by country.

This rule provides that Schedule 1 and Schedule 3 facilities may

include their export and import information with their declarations on

past activities, or may submit the information separately as reports.

Whether submitted as part of a declaration or as a report, Schedule 1

and Schedule 3 export and import information is included only in the

national aggregate declaration; BXA does not submit facility-specific

Schedule 1 or Schedule 3 export and import information from

declarations or reports to the USNA for transmittal to the OPCW. (It

should be noted, however, that notifications of Schedule 1 exports and

imports are submitted to the USNA for transmittal to the OPCW.) For

certain declared Schedule 2 plant sites, BXA does submit facility-

specific production, processing, consumption, export and import

information to the USNA for transmittal to the OPCW as part of the

annual declaration on past activities. The Schedule 2 national

aggregate declaration only includes information on exports and imports

by chemical and by country. These different requirements are due to

differences among the declaration provisions of the Verification Annex

of the Convention for Schedule 1, 2 and 3 chemicals.

Initial Declarations

One respondent requested clarification of the initial declaration

requirement for Schedule 1 facilities. For Schedule 1 facilities,

unlike Schedule 2 and 3 facilities, the initial declaration does not

include any production or other Schedule 1 chemical activity

information; it only provides a technical description of the facility.

Production and other activity information is provided in the annual

declarations. For the annual declarations on past activities for

calendar years 1997, 1998, and 1999, facilities are required to submit

declarations only for those years during which they produced more than

100 grams aggregate of Schedule 1 chemicals.

One respondent requested clarification that for the Schedule 2

initial declaration, plant sites are not required to submit a

declaration for all three years (1994, 1995, and 1996), but are only

required to submit a declaration for the year(s) in which one or more

plants on the plant site produced, processed, or consumed a

[[Page 73750]]

Schedule 2 chemical above the applicable threshold. BXA recognizes that

the Schedule 2 initial declaration requirement, as well as the annual

declaration on past activities, is burdensome on facilities and may

appear unnecessary. However, Part VII of the Convention's Verification

Annex requires initial declarations to be submitted for all three years

(1994, 1995, and 1996) by plant sites comprised of one or more plants

that produced, processed or consumed a Schedule 2 chemical above the

applicable threshold in any one of those three previous calendar years.

This initial declaration requirement will establish a profile on the

plant site that will be used by the OPCW to monitor activities. The

profile may be updated based on the plant site's subsequent submission

of annual declarations on past activities. In order to maintain an

accurate profile, a plant site must comply with the initial declaration

requirement as described in the note to Sec. 713.3(a)(1)(i). A plant

site must declare each chemical that it produced processed or consumed

over the applicable threshold quantity in any one of the calendar years

1994, 1995, or 1996, and must submit three Forms 2-3--one for each of

the calendar years 1994, 1995, and 1996--for each chemical. For each

year or years that a plant site did not produce, process or consume the

declared chemical over threshold, it must declare ``0'' quantity only

for those activities that triggered the declaration requirement. It

should leave blank on Form 2-3 those questions relating to activities

that did not exceed the applicable threshold quantity in any one of the

three previous years. Plant sites that submit an initial declaration

are subject to on-site verification if their activities exceed the

applicable inspection threshold quantities set forth in part 716.

Declaration and Approval Requirements for Schedule 1 Facilities

One respondent requested clarification of whether a Schedule 1

facility would be subject to declaration requirements if all of its

Schedule 1 production occurred prior to April 29, 1997, when the

Convention entered into force. If a facility produced more than 100

grams aggregate of Schedule 1 chemicals in calendar year 1997, it must

submit an initial declaration and an annual declaration on past

activities for 1997.

A respondent requested that BXA clarify that Schedule 1 facilities

must declare consumption and storage of Schedule 1 chemicals only if

they produced more than 100 grams aggregate of Schedule 1 chemicals.

This is correct, but BXA does not agree that the rule requires

clarification.

One respondent also requested BXA to state the grounds for

disapproval of a Schedule 1 facility. The Convention requires States

Parties to approve all Schedule 1 facilities. However, the Act does not

authorize the U.S. Government to require a facility to stop or limit

its production of Schedule 1 chemicals. Therefore, BXA cannot

disapprove a Schedule 1 facility.

Mixtures and other exemptions to declaration and reporting requirements

Four respondents requested that BXA include a low-concentration

threshold for mixtures containing Schedule 1 chemicals to reduce the

burden on all companies of identifying, quantifying and accounting for

trace amounts of Schedule 1 chemicals contained in complex product

mixtures and waste streams at very low concentrations. One respondent

expressed concerns about BXA not approving facilities that produce

Schedule 1 chemicals as unwanted byproducts in the manufacture of

another chemical, since the aggregate of such production could exceed

the Convention's 10 kg limit for Schedule 1 chemicals. BXA believes

that the production, export, and import of trace amounts of Schedule 1

chemicals as unavoidable by-products or impurities do not pose a threat

to the object and purpose of the Convention, would capture industries

totally unrelated to those involved in the intentional production of

Schedule 1 chemicals, and would result in the inspection of facilities

under a verification regime established for facilities that

intentionally produce Schedule 1 chemicals. Therefore, this rule

includes in part 712 a 0.5 percent ``round to zero'' rule for Schedule

1 chemicals produced as unavoidable by-products or impurities.

One respondent requested that BXA establish a uniform 30 percent

low concentration exemption for Schedule 2 activities because the

current two-tiered reporting system included in the proposed rule (10

percent for production, consumption, imports, exports; 30 percent for

processing) would create legal and compliance problems for industry.

Moreover, it puts U.S. companies at a competitive disadvantage with

other major chemical producers and traders which have adopted a uniform

30 percent mixtures rule. BXA agrees that the two-tiered mixtures rule

is unnecessarily complicated, creates an uneven playing field with our

major industrial competitors, and will capture downstream consumers

that pose no risk to the object and purpose of the Convention. BXA also

believes that adopting a 30 percent low concentration exemption for

declarations and reports on Schedule 2 transfers is consistent with the

U.S. Government's non-proliferation objectives. Therefore, this rule

establishes in part 713 of the CWCR a 30 percent mixtures exemption for

production, processing, consumption, export and import of Schedule 2

chemicals. However, should conditions change, BXA will review the 30

percent low concentration exemption for Schedule 2 exports and imports

to ensure that our non-proliferation interests are not being

undermined.

One respondent requested BXA to clarify whether the mixtures rules

contained in Secs. 713.3(a)(2) (i) and (ii) are applicable to

Sec. 713.1 of the CWCR. The respondent was concerned that a complete

prohibition on the importation of all Schedule 2 chemicals could create

a situation where importers unknowingly violate the CWCR and become

subject to penalties for importing of Schedule 2 chemicals. BXA agrees

with the respondent. This rule adopts a 10 percent low concentration

exemption for imports of Schedule 2 chemicals from non-States Parties

after April 28, 2000. This exemption mirrors the mixtures rule

contained in the Export Administration Regulations for exports of

Schedule 2 chemicals to non-States Parties after April 28, 2000.

Four respondents requested an exemption for UDOC mixtures similar

to that already existing for Schedule 3 chemicals. They noted the

inconsistency between having an 80% threshold for Schedule 3 chemicals

while maintaining a 0% threshold for UDOCs, which pose a much less

threat to the object and purpose of the Convention. The respondents

also wanted to use the mixtures rule to clarify what the term

``discrete'' means. Furthermore, the respondents stated that

identifying, quantifying, and accounting for low concentrations of

UDOCs contained in complex mixtures is excessively burdensome and

provides no benefits to the object and purpose of the Convention. BXA

does not accept these comments and this rule does not contain a UDOC

mixtures exemption. The Convention does not specifically permit a

mixtures rule similar to that for Schedule 2 or 3. Further, Sec. 710.1

of the CWCR contains the Convention's definition of a discrete organic

chemical. This rule does not provide specific exemptions for individual

UDOCs. If companies have specific questions about whether their

products

[[Page 73751]]

are covered by the CWCR, they should request a chemical determination

from BXA. However, BXA believes that a specific exemption for UDOCs

produced by synthesis as normal ingredients, by-products, or impurities

in the manufacture of foods designed for consumption by humans and/or

animals is warranted since such plant sites pose no threat to the

object and purpose of the Convention. This rule does not include an

exemption for facilities that produce UDOCs solely as consumer goods

packaged for retail sale and requests that the public comment on the

impact of the CWCR on such producers.

One respondent requested four additional exemptions to the

declaration requirements for Schedule 3 chemicals: materials that are

not produced by synthesis; materials that are not isolated for use or

sale as a specific end product; process intermediates that are

transformed at the same plant site; and components of waste streams (or

substances formed in waste streams). At this time, BXA believes it is

unnecessary to add additional exemptions for Schedule 3 chemicals

beyond the 80% threshold that currently exists. If the OPCW acts to set

a universal Schedule 3 threshold which is lower than 80% and if

Congress amends the Act, BXA will consider additional exemptions. For

purposes of the CWCR, the term ``production'' should be understood to

include a scheduled chemical (i.e., a Schedule 1, Schedule 2, or

Schedule 3 chemical) produced by a biochemical or biologically mediated

reaction. Further, Schedule 3 chemicals not isolated above 80% purity,

whether used or sold as specific end products or as intermediates or

disposed of as waste, are currently excluded by the Act and this rule.

Finally, excluding Schedule 3 process intermediates, with

concentrations greater than the applicable threshold (80% in the United

States), would be inconsistent with the object and purpose of the

Convention.

Another respondent suggested that in order to avoid double counting

of UDOCs, a UDOC produced in salt form and pure form should only be

counted once for declaration purposes, and that the substance to be

declared would be the final ``species'' isolated for use or sale

outside the facility. The CWCR require declaration of only the final

UDOC produced in whatever form for use or sale. If a facility is

producing UDOC(s) for use within the facility, that UDOC must be

declared if produced in quantities greater than the threshold specified

in part 715 of the CWCR.

Amended Declarations and Reports

One respondent requested clarification on whether or not the

submission of amended declarations and reports will, in itself, trigger

an enforcement action. An amended declaration or report will be used by

BXA to replace the information on a declaration, or the aggregate

national declaration that was previously submitted to the OPCW.

Submission of an amended declaration or report is considered a change,

a replacement, or an addition to previously submitted information.

Amended declarations and reports will not automatically trigger an

enforcement action.

One respondent requested clarification on the types of changes to a

previously submitted declaration on the production of UDOCs that would

require submission of an amended declaration or report. This rule

clarifies in Sec. 715.2 of the CWCR that for declarations involving

UDOCs, only changes of production quantity into a higher range, the

addition of a new PSF-chemical (phosphorus, sulfur, and fluorine)

produced above 30 metric tons at a PSF plant not previously declared,

changes to previously reported activities and end-use purposes, or the

addition of new activities or end-use purposes require an amended

declaration or report under part 715 of the CWCR.

One respondent requested clarification on the types of changes to

declarations or reports that will not require submission of an amended

declaration or report because they are considered minor or

insignificant information. This rule makes such clarification in

Secs. 712.6, 713.7, and 714.6 of the CWCR. Changes to previously

submitted information on chemicals, activities and end-use purposes, or

the addition of new chemicals, activities and end-use purposes require

submission of an amended declaration or report. For Schedule 1, 2, or 3

facilities subject to inspection, changes that may affect verification

activities, such as changes of the owner or operator, company name,

address, or inspection point of contact, require submission of an

amended declaration. For Schedule 1, 2, or 3 facilities not subject to

inspection and UDOC plant sites, changes that do not directly affect

the purpose of the Convention, such as changes to a company name,

address, points of contact, non-substantive typographical errors, etc.,

do not require submission of an amended declaration or report and may

be corrected in subsequent declarations or reports that are submitted

to BXA.

Timing of Submission of Declarations and Reports

One respondent suggested that the deadline for initial declarations

and reports, and annual declarations and reports on past activities for

calendar years 1997, 1998, and 1999, should be extended from 90 days to

150 days after the date of publication of the interim rule. The

respondent notes that it will be difficult to coordinate preparation of

declarations for its many facilities within the United States. Although

BXA understands the respondent's concern that it will be difficult to

coordinate declarations and reports from many different facilities in

the United States, the U.S. Government has committed to the OPCW that

it will meet its international obligations and submit data declarations

as soon as possible. In the early phases of the regulatory planning

process, BXA contemplated requiring industry to submit declarations

within 30 days after publication of the interim rule. However, industry

representatives advised BXA that industry would need 90 days to meet

its obligations, and BXA therefore extended the deadline for submission

of initial and annual declarations on past activities. This respondent

also requested that the submission deadline for declarations and

reports should be the ``postmarked'' date. This rule requires that

declarations and reports due to BXA be postmarked by certain dates.

One respondent requested that additionally planned activities be

declared to BXA 10 days in advance of the beginning of the additional

or new production, processing or consumption of Schedule 2 chemicals or

the additional or new production of Schedule 3 chemicals, rather than

21 days in advance as specified in the proposed rule. Because this rule

requires that declarations and reports be postmarked by specified

dates, BXA does not believe that 10 days is enough time for the U.S.

Government to declare such activities to the OPCW. Therefore, this rule

requires additionally planned activities be declared 15 days in advance

of the beginning of the activities.

Several respondents requested an extension of the due dates for

submission of annual declarations on past activities from February 13

to February 28, or later. The respondents believe that industry has a

more burdensome and time-consuming task in preparing declarations than

the U.S. Government. They noted that the U.S. Government has an

electronic means to process, compile and aggregate the data

[[Page 73752]]

and does not need 45 days to accomplish this task. The respondents

further stated that in early February, many companies may not have

compiled all of the necessary data available to complete declarations

because of ordinary business cycles, inventory control systems, or

other reasons, and to comply with the February 13th due date, many

companies will have to institute new changes to corporate policies and

procedures that may affect many aspects of their business. BXA agrees

with the respondents' arguments regarding the distribution of time

under the Convention's 90-day time frame. This rule reflects in Table 1

to parts 712 through 715 of the CWCR the new due date of February 28

for annual declarations and reports on past activities. Note that

annual declarations and reports for past activities for calendar years

1997, 1998, and 1999 are due to BXA by March 30, 2000.

Two respondents stated that declarations and reporting requirements

should be based on the effective date of publication of the CWCR in

calendar year 2000. They further state that the initial and first

annual declaration of past activities should be combined into a single

declaration for Schedule 2, Schedule 3, and UDOCs to prevent undue

burdens on industry. BXA supports the respondents' concerns about the

burden declarations and reports are on U.S. industry, and has already

taken steps to minimize the burden. For example, this rule includes a

recordkeeping provision that requires U.S. industry to provide

information for years up to the effective date of the rule for which

they do have records and states that BXA will accept whatever degree of

precision is found in existing records. The final section of the Cost

Benefit Analysis of the costs and benefits of alternatives, as well as

Section 2.5.2 of the final Regulatory Flexibility Analysis, provides

examples of how BXA has interpreted the CWC requirements as narrowly as

possible so that all companies will be declaring on the same basis for

calculating Schedule 2 activities to minimize declaration requirements

for Schedule 2 sites. Further, the instructions for Form 2-3 (for

Schedule 2 declarations), instruct plants sites producing below

threshold quantities in the reporting year to declare ``0'' because

they have a declaration requirement based upon activities in previous

years thus reducing burden and confidential business information

disclosure. Finally, this rule includes an exemption for UDOCs produced

by synthesis that are ingredients, by-products, or impurities in the

manufacture of foods designed for consumption by humans or animals.

One respondent requested that for rounding of information included

on declarations and reports, no more than two significant digits be

required, and that no greater precision be required than can reasonably

be provided using existing documentation, equipment, and measurement

techniques. This rule includes additional guidance in a new Sec. 711.5

and in the reporting and declaration requirement sections of Parts 712

through 715 of the CWCR.

Additionally Planned Activities

One respondent was concerned that the Schedule 2 and Schedule 3

requirement for a declaration on additionally planned activities due to

BXA 21 days before additionally planned activities can begin implies

that the facility may not commence its activities until BXA gives

permission to do so. The respondent believes that the declaration on

additionally planned activities is a ``notice'' to BXA, and the

facility should be free to commence additional production after the

requisite time has passed without receipt of any type of permission

from BXA. The respondent further notes that the CWCR indicate that the

timing for the declaration on additionally planned activities runs from

when the notice is ``delivered to'' BXA, stating that a facility will

not know when the declaration ``is delivered'' to BXA, but rather when

it is ``sent to'' BXA. BXA agrees that the additionally planned

activities declaration requirement is a ``notice'' to BXA declaring

newly planned activities. Facilities are responsible for submitting

declarations to BXA within the required time frame prior to the

commencement of the new activities. Facilities are not required to wait

for permission from BXA to commence such activities. If a facility

begins these activities prior to the required notification time frame,

the facility may be in violation of the declaration requirement and may

be subject to civil penalties. BXA agrees with the respondent's

recommendation to make the timing for submission of a declaration on

additionally planned activities the ``sent to'' date (e.g., the

postmarked date), as reflected in Secs. 713.5(b) and 714.4 of the CWCR.

Two respondents asked about the requirements for declaring

additionally planned Schedule 2 and Schedule 3 activities provided in

Secs. 713.5 and 714.4, respectively, of the proposed CWCR. This rule

expands the requirements for additionally planned activities consistent

with an OPCW decision dated May 16, 1997 (C-I/DEC.38). Declarations on

additionally planned activities by plant sites declared under

Sec. 713.3(a)(1)(iii) or Sec. 714.2(a)(1)(iii) are required for: (1) An

additional plant not declared under Secs. 713.3(a)(1)(iii) or

714.2(a)(1)(iii) that plans to produce, process, or consume a Schedule

2 chemical or produce a Schedule 3 chemical above the applicable

declaration threshold; (2) an additional Schedule 2 chemical that will

be produced, processed, or consumed above the applicable declaration

threshold at a plant declared under Sec. 713.3(a)(1)(iii) or an

additional Schedule 3 chemical which will be produced above the

declaration threshold at a plant declared under Sec. 714.2(a)(1)(iii);

(3) an additional planned activity (production, processing, or

consumption) above the applicable threshold for a chemical declared

under Sec. 713.3(a)(1)(iii); (4) a planned increase in the production,

processing, or consumption of a Schedule 2 chemical by a plant declared

under Sec. 713.3(a)(1)(iii) or a planned increased in the production of

a Schedule 3 chemical by a plant declared under Sec. 714.2(a)(1)(iii)

to an amount which exceeds the applicable inspection threshold (see

Secs. 716.1(b)(2) and 716.1(b)(3) for the respective Schedule 2 and 3

thresholds); (5) a planned increase in the production of a Schedule 3

chemical by declared plants at a plant site to an amount above the

upper limit declared under Sec. 714.2(a)(1)(iii); (6) a change in the

anticipated starting or ending date of production, processing, or

consumption declared under Sec. 713.3(a)(1)(iii) by more than three

months; and (7) a planned increase in the production, processing, or

consumption of a Schedule 2 chemical by a declared plant by 20 percent

or more above that declared under Sec. 713.3(a)(1)(iii).

While BXA recognizes that some of the new requirements in this rule

increase the declaration burden on industry, they are required in order

to meet U.S. Government obligations under C-I/DEC.38 and are consistent

in scope with the original requirements contained in Secs. 713.5 and

714.4 of the proposed CWCR. BXA anticipates an additional 20

declarations on additionally planned activities based upon the above

new requirements, but requests that concerned parties submit comments

regarding this estimate and the overall burden of requirements mandated

under C-I/DEC.38. BXA will reevaluate these additionally planned

[[Page 73753]]

activities requirements based upon this input.

Definitions

One respondent remarked that the definition of ``declaration form''

states that all declared facilities will have facility-specific

information transmitted to the OPCW, but pointed out that information

included with UDOC declarations and Schedule 3 export and import

information is only aggregated and facility-specific information is not

submitted to the OPCW. The respondent suggested revisions to the

definition of ``declaration forms'' to clarify this point. Facility-

specific information contained in UDOC declarations is submitted to the

OPCW by the USNA. However, to clarify what information is submitted to

the OPCW, this rule revises the definitions of ``declaration or report

form'' and ``reports.''

One respondent requested a revision to the definition of

``consumption,'' noting that most chemical reactions are not 100%

complete. Accounting for the majority of the material as consumed and

the remainder as either waste or as recycled starting material is

reasonable. Therefore, this rule defines ``consumption'' of a chemical

as its conversion into another chemical via a chemical reaction. Un-

reacted material must be accounted for as either waste or as recycled

starting material.

One respondent requested clarification of ``toxic chemical'' as

used in Sec. 716.2(b)(1)(ii)(E) of the CWCR. BXA agrees that

clarification is warranted. Therefore, this rule adds a new definition

of ``toxic chemical'' to Sec. 710.1 of the CWCR. The definition is

based on the definition found in the Act.

One respondent commented that the definition of the term ``trading

company'' appears to cover the requirements for submitting a report by

an undeclared plant site, stating that the terms ``entity'' and

``companies'' in the definition are confusing. The respondent further

states that the phrase ``entities involved in the export or import of

chemicals'' could be interpreted to mean that an entity engaged in both

exports and imports is not a trading company, and only scheduled

chemicals are subject to reporting by trading companies. BXA agrees

that the definition of ``trading company'' requires clarification.

Therefore, this rule revises the definition of ``trading company'' by

replacing the word ``entity'' with ``person,'' which is also defined in

Sec. 710.1, and by clarifying that trading companies that export or

import scheduled chemicals in amounts greater than specified thresholds

are subject to reporting requirements, but not routine inspections.

Several respondents requested that a definition of production be

added to Sec. 710.1 of the CWCR to help clarify declaration

requirements. This rule adds the Convention's definition of

``production'' as the formation of a chemical through a chemical

reaction.

One respondent requested that the definition of ``host team'' be

modified to include facility representatives to recognize that the

employees of the inspected facility must contribute to the host team

because of their expertise. Section 303(b)(2) of the Act states that

``[t]he United States National Authority shall coordinate the

designation of employees of the Federal Government to accompany members

of an inspection team of the Technical Secretariat.'' The term ``Host

Team'' in Sec. 710.1 of the CWCR is meant to assign a functional name

to these designated federal government employees, who will be drawn

from different agencies, by describing their role during inspections

(i.e., to host inspectors at U.S. facilities). While BXA fully expects

that facility representatives will act as ``de facto'' Host Team

members during inspection activities, the Act imposes certain

requirements on federal employees that legally cannot be performed by

facility representatives (e.g., obtaining administrative warrants,

negotiating facility agreements, and representing the United States'

interests as a State Party). Therefore, the term ``Host Team'' in the

CWCR refers to the U.S. Government team that accompanies inspectors

from the OPCW at facilities subject to inspection, and does not include

civilian site representatives.

Finally, one respondent requested clarification of the definition

of ``storage'' as it applies to Schedule 2 and 3 chemicals and UDOCs.

BXA does not agree that a clarification is necessary, because no

quantitative reporting of storage for Schedule 2 or 3 chemicals or

UDOCs is required by the CWCR.

Electronic Submission of Information

One respondent requested that BXA permit industry to electronically

request assistance in determining its obligations under the CWCR,

including chemical determinations. The respondent further requests that

BXA respond to an incomplete request for assistance if the omitted

information is not required for responding to the request. BXA supports

electronic submissions of information to the extent possible.

Therefore, this rule includes more detailed information in Sec. 711.3

on how to contact BXA electronically. BXA will respond to requests for

chemical determinations within 10 working days of receipt. BXA will

respond to other inquiries about industry obligations under the CWCR in

a timely manner.

Facility Agreements

One respondent, while supporting the U.S. Government's approach on

managed access, requested that the concept of managed access be

introduced for UDOC inspections to strengthen the ability of Host Teams

to protect confidential business information. The Convention contains

strict rules for inspection team access to UDOC facilities based on the

area of the plant site to be inspected. The CWCR are not intended to

provide this level of detail since the actual access provided to

inspection teams will vary from facility to facility. Part IX of the

Convention's Verification Annex provides that inspected States Parties

have the right to manage inspection team access to declared plants on a

plant site. However, access to other areas of the plant site will be

agreed upon, which is more controlled than managed access. Therefore,

this rule does not specify managed access for UDOC facilities because

it could result in expanded access to inspection teams beyond the

Convention, which BXA does not support. BXA will ensure that inspection

team access does not exceed the terms of the Convention.

One respondent requested that BXA make a reasonable effort to

complete facility agreement negotiations with the OPCW on the

establishment of a new Schedule 1 facility within 200 days, stating

that without this language, any new Schedule 1 production by a new

facility could be delayed indefinitely. The Act does not give BXA the

authority to implement the Convention's restrictions on Schedule 1

production at a new facility where a facility agreement has not been

concluded. New Schedule 1 facilities must notify BXA 200 days prior to

commencing production of Schedule 1 chemicals above 100 grams

aggregate. BXA will work with the USNA to conclude a facility agreement

for new Schedule 1 facilities with the OPCW prior to the commencement

of production of Schedule 1 chemicals above 100 grams aggregate.

Two respondents requested that the facility be consulted and be

authorized to approve any facility agreement prior to conclusion by the

U.S. Government and the OPCW. The respondents further requested that

the U.S. Government consult with the facility prior to final

interpretations of the provisions of the facility agreement. BXA

recognizes that facility input is critical to the successful

negotiation of facility agreements. The

[[Page 73754]]

proposed rule inadvertently omitted language from the Act that provides

facilities with the right to participate in the preparation of facility

agreements. This rule includes such language in Sec. 716.6(b) of the

CWCR, and BXA will consult with facilities to the maximum extent

possible during negotiations with the OPCW. The United States cannot

withhold conclusion of a facility agreement with the OPCW because of

facility concerns. The Convention does not provide for facility

approval of the facility agreement. Industry should note that BXA will

inform the affected facility of the status of negotiations at the OPCW,

permit facility representatives to observe negotiations with the

Technical Secretariat to the maximum extent practicable, and prior to

conclusion of a facility agreement with the Executive Council, will

provide facilities with an opportunity to comment. During final

negotiations with the OPCW, BXA will give consideration to the

facility's comments. Finally, BXA will consult with facility

representatives prior to interpreting the facility agreement, once

completed. If a disagreement over the provisions of a facility

agreement occurs between the OPCW and BXA during an inspection that

cannot be resolved on-site, the issue will be included in the

preliminary factual finding report. After consulting with the U.S.

interagency group established by the Act and E.O. 13128, the USNA and

BXA will meet with the OPCW to resolve the issue. BXA will keep the

facility informed of discussions with the OPCW.

BXA received several comments on the Schedule 2 Model Facility

Agreement (MFA) found in Supplement No. 3 to part 716 of the CWCR.

First, concerns were expressed about a provision found under Section

2--Health and Safety, that states that if the inspected State Party so

requests on the basis of confirmed contamination or hazardous waste

requirements or regulations, any piece of equipment involved in the

inspection activities will be left at the plant site at the end of the

inspection. The respondent states that the facility may not be legally

authorized to store or dispose of contaminated items. BXA will discuss

issues related to disposal of contaminated items and hazardous waste

with facilities as necessary, and facility agreements will be drafted

accordingly.

Another concern raised by the respondents regarded sampling.

Section 7.4, paragraph 2 of the Schedule 2 MFA states in part that

``[s]ampling and analysis, for inspection purposes, may be carried out

to check for the absence of undeclared scheduled chemicals. Each sample

will be split into a minimum of four parts at the request of the

inspection team in accordance with Part C of Attachment 10.'' The

respondent states that the facility should retain the right to request

a sample split and analyze it. BXA does not believe that the sampling

language needs revision. The language does not preclude the inspected

facility from requesting split samples. Facilities should further note

that attachments to the MFA are intended to be site-specific and

completed with facility input.

One respondent correctly notes that Section 7.4, paragraph 12 of

the Schedule 2 MFA erroneously states that the inspection must stop at

the direction of the plant site representative. BXA agrees that the

plant site representative should not be authorized to stop analysis

activities in the event that these activities are not in accordance

with the facility agreement or agreed analysis procedures, or otherwise

pose a threat to safety or environmental regulations or laws.

Therefore, this rule revises the language in Section 7.4, paragraph 12

to state that the inspected State Party, in consultation with the plant

site representative, may cease such activities.

BXA received several other comments regarding concerns that the

Schedule 2 MFA does not allow for enough consultation with the facility

representative. Other comments focused on suggestions to add clarifying

language in the MFA that is site specific. Industry should note that

the MFAs found in Supplements No. 2 and 3 to part 716 are models that

include general language that could apply to all inspected facilities.

Attachments to the MFAs will make the facility agreement site-specific.

Other comments made by the public regarding the Schedule 1 and 2

MFAs have been incorporated in Supplements No. 2 and 3 to part 716.

Where applicable, corresponding changes were made to both MFAs.

BXA also received a request to develop and include in the CWCR a

Schedule 3 MFA. BXA is assessing the needs and requirements of a

Schedule 3 MFA. The OPCW's Technical Secretariat has developed a draft

MFA but there has been no movement by States Parties to complete it. To

date, no State Party that has undergone a Schedule 3 inspection has

requested a facility agreement. Moreover, the OPCW has suggested that

if a State Party requests a facility agreement for a Schedule 3 plant

site, the length of an initial inspection will be extended by 2 days.

Since the Convention limits the number of Schedule 3 and UDOC

inspections to a total of 20 inspections per year, it is unlikely that

a re-inspection will occur at a Schedule 3 facility within 5 to 10

years. Nevertheless, the Act gives Schedule 3 facilities the right to

request a facility agreement and BXA will take the respondent's

suggestion into consideration. BXA would prefer that States Parties

reach consensus on a general framework for a model before drafting a

national model, but will consider doing so if States Parties are unable

or unwilling to complete a model before Schedule 3 inspections commence

in the United States.

Finally, one respondent requested that language be added to the

CWCR to require OPCW inspection teams to follow the requirements of

relevant model facility agreements during an initial inspection. During

initial inspections, verification activities are subject to the

Convention's ``General Rules of Verification'' (Part II of the

Verification Annex) and the applicable annex for the type of facility

being inspected (Parts VI, VII, VIII, or IX). Although BXA does not

believe it is appropriate to include the respondent's suggested

language in the CWCR, BXA suggests that facilities subject to initial

inspection develop a preliminary draft facility agreement based on the

CWCR's model facility agreement. This preliminary draft will be

provided to the inspection team upon arrival at the facility. Although

the OPCW is not bound by this preliminary draft, BXA will urge that

inspection teams use it as a guide during initial inspections.

Regardless, inspection teams are always under the obligation to

discharge their functions with the least possible inconvenience and

disturbance to the facility, and to avoid hampering or delaying the

operation of a facility or affecting its safety.

Initial and Routine Inspections

Section 716.5 of the CWCR provides that the Department of Commerce

provide written Host Team notification of an inspection. Such notice

will usually be via fax or phone. If notification by fax or phone

fails, a written notification of the inspection will immediately be

posted at the plant site. A respondent questioned whether there will be

an additional notification that includes the contents of the OPCW

inspection mandate after it has been provided to the Host Team at the

point of entry. This respondent also asked how much time the facility

will have to respond to the notification, and whether the facility will

be asked to respond to the notification regarding warrants. The

[[Page 73755]]

Host Team notice from the Department of Commerce serves to notify the

facility of an inspection, advise the facility of the availability of

U.S. Government assistance, and to determine if an administrative

warrant is required. BXA asks the facility to reply to the request for

consent within 4 hours. If, after 4 hours, the request for consent is

not granted, BXA will seek an administrative warrant. The notification

also advises the facility of the availability of an Advance Team. The

company may wish to respond as soon as possible to maximize the time

available for preparation of an inspection. The Convention requires

transport of the OPCW Inspection Team to the inspected site within 12

hours of presenting the mandate. Due to this time constraint, BXA may

not be able to provide the mandate to the facility prior to the arrival

of the Inspection Team at the facility. However, the Commerce-led Host

Team currently plans to pass the mandate, if possible, to the Advance

Team at the site as soon as possible.

One respondent requested BXA to share a copy of its preliminary

(renamed ``Host Team'') notice with industry for comment. The

respondent wanted to ensure that it contains certain ``critical''

information such as the inspection mandate and establishes a dialogue

between the U.S. Government and facility on health and safety

information that could impact a facility during verification

activities. Once the CWCR are published and the interagency formally

clears the Host Team notification, BXA will make the notice available

to the public upon request. The Host Team notification is meant to

alert the facility of an impending inspection, determine whether the

facility consents to the inspection, and ascertain whether the facility

requests Advance Team support. The Host Team notification will also

contain a copy of the OPCW's notification to the USNA, which includes

health and safety information regarding special needs of inspectors and

inspection equipment. However, such information will change from

inspection to inspection, and BXA cannot anticipate Inspection Team

needs in advance. If there are special facility-specific issues (e.g.,

health and safety) that the Host Team or OPCW needs to be aware of

prior to the commencement of an inspection, they should be communicated

to the Advance Team during pre-inspection preparation activities. The

Advance Team will then inform the Host Team Leader, who will brief the

Inspection Team upon arrival at the U.S. point of entry (POE)

(Washington Dulles International Airport). The inspection mandate is

not part of the Host Team notification because the Host Team Leader

will not receive the mandate until the Inspection Team arrives at the

POE.

One respondent requested that inspections start in normal business

hours, therefore reinforcing the Convention's commitment to not impact

the regular operation of a facility. BXA does not agree that all

inspections will be conducted during normal business working hours.

Verification activities include, inter alia, physical plant

inspections, records review, the preparation of preliminary factual

findings and draft facility agreements, if applicable. Many of these

activities can be done in an administrative work space outside of

operations areas, but all must be completed prior to the conclusion of

an inspection. Limiting inspection activities to normal working hours

will increase the amount of time (i.e., number of days) Inspection

Teams remain on-site. Inspectors are obligated to discharge their

functions with the least possible inconvenience and disturbance to the

facility, and to avoid hampering or delaying the operation of a

facility or affecting its safety. BXA will take all of these factors

into consideration when determining whether an inspection should

commence, continue, or conclude during other hours. The respondent also

requested that the facility be consulted for any extension in the

duration of an inspection prior to agreement by the Host Team Leader

and the Inspection Team. BXA supports this request. Therefore, this

rule adds to Sec. 716.5(b)(2) and (b)(3) that the Host Team Leader will

consult with the inspected facility on any extension of the inspection

prior to making an agreement with the Inspection Team.

BXA has also determined that part 716 of the proposed CWCR was

deficient regarding two inspection requirements of the Convention: pre-

inspection briefing and debriefing on the preliminary factual findings.

The Convention requires that prior to the commencement of an

inspection, facility personnel brief the Inspection Team on the

facility, the activities carried out there, safety measures, and

administrative and logistic arrangements necessary for the inspection.

The pre-inspection briefing is limited to three hours. New

Sec. 716.4(c) of the CWCR contains the requirement for facilities to

provide a pre-inspection briefing and lists topics to be addressed. The

Convention also requires that the Inspection Team meet with the

inspected State Party and facility upon completion of the inspection to

review its preliminary factual findings report and to clarify any

ambiguities. The debriefing must be completed no later than 24 hours

after the completion of the inspection. New Sec. 716.4(i) contains the

requirement for a debriefing. Facilities should note that the time

required for a pre-inspection briefing and debriefing on the

preliminary factual findings is in addition to the specified period of

inspection for Schedule 2, Schedule 3, and UDOC plant sites. This rule

also includes new Secs. 716.4(b), (d) and (e) to provide a clearer

description of the inspection process and to set forth the scope of

consent to an inspection. BXA invites the public to comment on the

changes to part 716, particularly the new sections.

Three respondents stated that additional information should be

included in Sec. 716.3 to clarify, for facilities subject to routine

inspection, that withholding consent to an inspection or withdrawing

consent following the commencement of an inspection are not violations

of the regulations. BXA notes that the Act provides that consent may be

withheld for any reason or no reason. BXA also agrees that in most

circumstances, withdrawal of consent would not be a violation under

Sec. 719.2(a)(1) of the CWCR.

One respondent recommended that, in order to reduce the likelihood

of a misunderstanding by the OPCW inspectors, and to avoid possible

``international incidents,'' Sec. 716.3 should also specify the

procedures to be followed if consent is withdrawn during an inspection.

BXA does not accept this recommendation because procedures may differ

from inspection to inspection, depending on the circumstances and the

timing of a withdrawal of consent, and on whether the OPCW inspectors

decide to wait for BXA to obtain an administrative warrant and then to

continue the inspection or to terminate the inspection.

One respondent raised Constitutional concerns about the

installation of on-site monitoring equipment at Schedule 1 facilities.

Although paragraph 29 of Part VI of the Convention's Verification

Annex, pertaining to verification of declared Schedule 1 facilities,

gives the OPCW the right to install such instruments, the U.S.

Government does not anticipate that the OPCW will request to do so for

facilities subject to the CWCR. This rule moves the provision for on-

site monitoring of Schedule 1 facilities from Sec. 716.2 to a new

Sec. 716.8.

[[Page 73756]]

A respondent requested that BXA reduce the post-inspection

reporting burden on industry by allowing reports on inspection-related

costs to be voluntary, summarized, estimated by BXA or the facility, or

reported in ranges, and that the time frame for submitting such reports

be extended to 180 days after an inspection. BXA is sympathetic to the

respondent's concerns, however, the Act specifically requires that the

President report the total costs borne by United States business firms

in the course of inspections to the Congress. This requires BXA to

compel industry to submit reports on the total costs related to

inspection. BXA gives facilities the discretion to determine the

methodology for computing total costs. Because the annual report on

inspections must be submitted annually to Congress, BXA must be able to

provide as current figures as possible without excessively burdening

industry. BXA believes that the 90 day time frame is reasonable and

meets the requirements of the Act.

Clarification Procedures; Challenge Inspection Requests

Two respondents questioned whether the Department of Commerce has

the authority, under the Act, to require facilities subject to the CWCR

to provide information in response to a clarification request from

another State Party, and suggested deletion of Sec. 717.1(b) of the

CWCR. Section 101(e) of the Act and Section 3 of Executive Order No.

13128 give the Department of Commerce adequate authority to require

such information. In addition, as one respondent highlighted, the

clarification procedures in Article IX of the Convention provide a

means of clarifying and resolving ambiguities without the need for

challenge inspections. Three respondents stated that the requirement

for facilities to provide information to the Department of Commerce

pursuant to a clarification request from another State Party or the

OPCW should be clarified to establish substantive limits on the scope

of the request and a time frame for response. Substantive limits are

already provided in Sec. 717.1(b). The information must pertain to

``reporting, declaration, notification, or inspection requirements set

forth in parts 712 through 716.'' BXA agrees that a time frame for

response should be provided. Therefore, this rule requires in

Sec. 717.1(b) that information be provided to the Department of

Commerce pursuant to a clarification request within five working days.

This time frame will allow the U.S. Government to respond to another

State Party or to the OPCW within 10 days, as required by Article IX of

the Convention.

One respondent recommended that this part establish procedures for

resolving differences, including meetings with the OPCW, to avoid the

need for challenge inspections. BXA does not believe it is necessary or

appropriate for the CWCR to set forth procedures that the U.S.

Government will follow in communicating with other States Parties or

the OPCW.

Finally, one respondent suggested that a request for information

under the clarification procedure amounts to a criminal investigation,

and another respondent suggested that a facility should be able to

require BXA to obtain an administrative warrant before providing the

requested information. A request for information does not rise to the

level of a criminal investigation. An administrative warrant is not

appropriate in this context, because no physical inspection of a

facility is involved and the information requested falls within the

scope of the CWCR. Willful failure or refusal to provide information in

response to a BXA request under part 717 of the CWCR would constitute a

violation under Sec. 719.2 of the CWCR.

Facilities That Cease Involvement With Declarable Activities

Respondents were concerned about whether a facility will be

absolved from further requirements under the CWCR when the facility

eliminates its declarable activities. The respondents recommended that

BXA provide a mechanism by which the facility can commit to elimination

of declared activities, and therefore not be subject to initial

declaration and reporting. BXA does not agree that a facility should be

able to avoid submission of a declaration based on the facility's

intent to terminate the declarable activity. This would be inconsistent

with the requirements of the Convention.

Violations and Penalties

BXA received several comments on part 719--Enforcement, many of

which were adopted. The most significant changes that were made to part

719 concern its structure and the application of the administrative

process. Part 719 of this rule is intended to more accurately reflect

the three categories of Chemical Weapons Convention violations:

``violations of the Act subject to administrative and criminal

enforcement proceedings'' (Sec. 719.2); ``violations of IEEPA subject

to judicial enforcement proceedings'' (Sec. 719.3); and ``violations

and sanctions under the Act not subject to proceedings under the CWCR''

(Sec. 719.4). Section 719.2 of the CWCR sets forth violations of the

Act. The Department of Commerce and Department of State jointly apply

the administrative process that applies to these violations. The

administrative procedures are found in 15 CFR Secs. 719.5-719.22 and in

22 CFR part 103, subpart C. Section 719.3 sets forth the violations of

the International Emergency Economic Powers Act (IEEPA). Part 719

provides no administrative process for these IEEPA violations. They are

referred to the Department of Justice for judicial enforcement. The

violations contained in Sec. 719.4 have as their basis the Act, but

they are not subject to the CWCR and are provided for informational

purposes only.

In addition to the concerns expressed about structure and

organization, there were also several comments expressing general

displeasure with the precise wording of various violations and

penalties. While BXA is sympathetic to some of these comments, the

violations and penalties in the CWCR merely recite the violations and

penalties as they appear in the relevant statutes. Thus, BXA made no

substantive changes to the violation and penalty language.

Although no substantive changes were made to the language of the

violations and penalties, BXA does believe it is necessary to clarify

what the violation of ``willfully impeding an inspection'' might mean.

One respondent expressed concern that this violation could be construed

so that the exercise of the right to withhold consent (which makes it

necessary for the government to obtain an administrative warrant), or

that efforts to protect the safety of the inspectors, would constitute

willfully delaying or impeding an inspection. Since Sec. 305(a) of the

Act provides that the owner or the operator, occupant, or agent in

charge of the premises may withhold consent for any reason or no

reason, BXA does not believe those concerns are well founded.

Finally with respect to the violations and penalties, some

respondents were confused by use of the terms ``knowingly'' and

``willfully.'' The basis for this confusion was the mistaken assumption

that the Act was the statutory basis for the import violations, which

caused confusion because the criminal penalty provision says

``willfully'' rather than ``knowingly'' as required by the Act. he

reason for use of the word ``willfully'' rather than (or in addition

to) ``knowingly'' is that the statutory basis for the import violations

is the International Emergency

[[Page 73757]]

Economic Powers Act. Therefore, the criminal penalty for import

violations mirrors the IEEPA penalty provision. Several respondents

also asked BXA to clarify the meaning of the word ``knowingly'' as used

to describe the criminal penalties for refusal violations. However, the

penalty language and standards are statutory (see Sec. 501(b) of the

Act), and are therefore more appropriately interpreted by the courts.

Administrative Procedures

One respondent objected to Sec. 719.6(c), which states that

defenses that the respondent does not set forth in the Answer to a

Notice of Violation and Assessment (NOVA) are waived, except for good

cause shown. However, it is especially important that this standard

administrative law provision be included in the CWCR because the

statutory time limit for administrative proceedings is very short (30

days). Interested parties should keep in mind that the provision is not

an absolute waiver of defenses--it does permit a respondent to present

additional defenses if the Administrative Law Judge (ALJ) determines

there is a good reason for doing so.

Several respondents expressed concern about Sec. 719.20. As

proposed, it permitted documents filed with the ALJ to be made

available immediately upon filing. In response to these comments, this

rule revises Sec. 719.20(c)(2) to state that the record for decision,

including the NOVA and other documents that are filed in an

administrative proceeding, will be available to the public only after

the final administrative resolution of a case. Prior to that final

resolution, any party may request that the ALJ restrict access to any

portion of the record, and the ALJ may so direct. Thus, the revised

Part 719 ensures that parties have the opportunity to petition for

restricted access to documents or portions of documents, and to have

the ALJ rule on such petitions, before the record for decision becomes

public.

In addition, respondents expressed concern, pursuant to

Sec. 719.20(b) of the CWCR, that the ALJ may transfer previously

restricted material to the unrestricted portion of the record once it

becomes declassified or unrestricted due to the passage of time. The

respondent suggested implementing a new process whereby the ALJ would

provide notice and opportunity for objection before making such a move.

BXA has not made such a change as the material is already protected.

Since material may not be transferred until it becomes declassified or

derestricted, the ALJ would have to make inquiries if there were any

doubt about the status of the material.

Other respondents requested that Sec. 719.14, regarding hearings,

be clarified. BXA changed this section to provide that hearings are

closed to the public, except upon good cause shown, and clarified that

evidence of settlement discussions is not admissible in any

administrative proceeding, and that witnesses may be cross-examined.

However, the ALJ continues to have discretion over what evidence is

admissible; the federal rules of evidence do not apply.

One respondent asked why Sec. 719.18 sets forth factors to be

considered in assessing penalties for reporting- and inspection-related

violations but not for import violations. As the revised CWCR provides

no administrative process for import violations, the question is moot.

However, the answer was that the statutory basis for the two types of

violations is different: the Act is the basis for reporting- and

inspection-related violations and the IEEPA is the basis for import

violations. Only the Act requires specific factors for consideration.

Various other comments requested clarification regarding for whom

the Department of Commerce provides legal representation

(Sec. 719.1(a)(2)), service via facsimile (Sec. 719.8(b)), issuance of

subpoenas (719.11(b)), and payment for copies of the hearing transcript

(Sec. 719.14(c)(1)). All these clarifications have been made. BXA also

agreed to use the word ``request'' rather than the word ``demand'' in

connection with requests for a hearing (Sec. 719.6). Other comments did

not result in any changes. BXA did not extend the time permitted to

request a hearing from 15 days to 30 days for refusal violations as the

15-day time period is statutory, and BXA did not delete the requirement

for a notice of appearance.

Denial of Export Privileges

Like part 719, part 720 of the CWCR was reorganized and clarified,

though not significantly changed. This reorganization was accomplished

in lieu of deleting part 720 and organizing denial cases as a third

category of cases in part 719 as one respondent suggested. That

suggestion was not adopted because a denial of export privileges can

only occur after a conviction of crimes outside the scope of the CWCR.

The Act requires that respondents have notice and an opportunity for

hearing before a denial of export privileges is imposed, and this part

sets forth that process. Several respondents noted discrepancies in

part 720 of the CWCR regarding the standards for ALJ review and the

standards for Under Secretary review. BXA has changed this part to make

it clear that anyone may request a hearing before an ALJ, but that

there are specific grounds for appeal from the ALJ decision to the

Under Secretary. The grounds for appeal include: omission of a

necessary finding of fact, a necessary legal conclusion is contrary to

law, a prejudicial error occurred, or the decision was arbitrary,

capricious, or an abuse of discretion.

Additional Public Comments

There were several public comments that were not addressed in this

Supplementary Information section, but those comments were reviewed and

incorporated, as appropriate, in the CWCR itself. Additionally,

typographical errors and minor clarifications were corrected in this

rule.

III. Public Comments on Declaration and Reporting Forms and

Handbooks

This section outlines comments received from four respondents

regarding the Department of Commerce's Federal Register notice (Volume

64, Number 141) of July 21, 1999, announcing an Office of Management

and Budget review and request for comments on BXA's proposal for

collection of information under the provisions of the Paperwork

Reduction Act (44 U.S.C. Chapter 35) for the Chemical Weapons

Convention Declaration Forms (OMB Approval Number 0694-0091). Two

respondents requested that BXA establish an official record of the

public comments received on the forms by including those comments in

the supplementary information section of this rule. BXA agrees with

this request and provides those comments herein. All typographical

errors and minor clarifications noted by the respondents were

corrected, and are not addressed here.

Declaration and Report Handbooks for Schedule 1, 2 and 3 Chemicals and

Unscheduled Discrete Organic Chemicals

Section 3 ``Guide to Submission of Forms'' of the Declaration and

Report Handbooks for Schedules 1, 2 and 3 and Unscheduled Discrete

Organic Chemicals. One respondent stated that the ``Guide to Submission

of Forms'' complicates industry's ability to decipher its specific

obligations. The respondent requested clarification and that BXA ensure

the consistency of the final reporting requirements and establish an

immediate routine for fulfilling these requirements. Additionally, two

respondents stated

[[Page 73758]]

that the Guides indicate Form A is ``required, as appropriate'' whereas

they believe Form A is optional and should be referred to as

``attached, as appropriate.''

BXA clarified each of the Handbooks'' ``Guide to Submission of

Forms'' by including the routine date for submission of annual

declarations on past activities and annual reports on export and import

activities. However, because initial declarations and reports as well

as declarations and reports on past activities from multiple years must

be submitted to BXA within 90 days after publication of this rule, BXA

is maintaining the specific declaration and report submission

requirements as a note to the Guide. In the first revision to the

Handbook, BXA will remove these notes from the Guide and the routine

filing requirements will be clearly defined.

BXA also revised each of the Handbooks' ``Guide to Submission of

Forms'' to reflect that Form A is an attachment and should be submitted

as appropriate. Form A should be used to submit any attachment to a

declaration or report including, but not limited to, a plant site

diagram, a technical description of a Schedule 1 facility or a

structural formula drawing of a chemical.

The following clarifies the specific types of declarations and/or

reports that must be submitted to BXA within 90 days of the publication

of the Chemical Weapons Convention Regulations (CWCR) as well as the

calendar years for which this information must be provided:

Schedule 1

--Initial Declaration: Submit a technical description of your facility

if you produced in excess of 100 grams aggregate of Schedule 1 chemical

in calendar years 1997, 1998, or 1999 (do not submit any production

data)

--Annual Declaration on Past Activities: 1997, 1998, and 1999

--Annual Report on Exports and Imports: 1997, 1998, and 1999

Schedule 2

--Initial Declaration: 1994, 1995, and 1996 (For each chemical, you

must submit three Forms 2-3--one for each of the calendar years 1994,

1995, and 1996.)

--Initial Report on Exports and Imports: 1996

--Declaration on Chemical Production at any time since January 1, 1946

for Chemical Weapons (CW) Purposes: one-time declaration

--Annual Declaration on Past Activities (production, processing

consumption, export and import): 1997, 1998, and 1999

--Annual Report on Exports and Imports: 1997, 1998, and 1999

Schedule 3

--Initial Declaration: 1996

--Initial Report on Exports and Imports: 1996

--Declaration on Chemical Production at any time since January 1, 1946

for Chemical Weapons (CW) Purposes: one-time declaration

--Annual Declaration on Past Activities (production): 1997, 1998, and

1999

--Annual Report on Exports and Imports: 1997, 1998, and 1999

Unscheduled Discrete Organic Chemicals (UDOCs)

--Initial Declaration: 1996

--Annual Declaration on Past Activities (production): 1997, 1998, and

1999

Supplement 1 to the Declaration and Report Handbooks--Latitude and

Longitude of the Facility. Three respondents recommended that the plant

site should be able to choose and identify a reasonable or prominent

location within the declared plant site for declaring the geographical

coordinates. All three respondents noted that the center of the plant

site may be an inaccessible location. One respondent recommended that

if the plant site chooses the location for the geographical

coordinates, then it must also describe or identify the point for which

the coordinates were provided, such as a control room, an

administration building or the front gate. Two respondents recommended

that BXA specifically authorize the use of Global Positioning System

(GPS) technology as the preferred method of calculating the center

point of the facility. Lastly, one respondent that recommended BXA

remove Supplement 1 (How to Determine Latitude and Longitude from

Topographical Maps) and put this information on the BXA web site.

BXA recognizes that most companies will use a GPS to determine its

latitude and longitude and that the OPCW generally uses this method to

confirm declared geographical coordinates. BXA notes, however, that a

GPS reading is not the only method available for identifying the

geographical coordinates of the plant site and therefore will not

designate GPS as the preferable method for providing latitude and

longitude. Geographical coordinates provided from a GPS reading are

acceptable. In addition, upon request BXA will informally assist

companies to identify its geographical coordinates. BXA has made minor

clarifications to Supplement 1 in response to the comments.

Supplement 3 to the Declaration and Report Handbooks. One

respondent noted that Macedonia was missing from the list of country

codes which are used for reporting exports and imports. Another

respondent noted that Supplement 3 does not include a code for Taiwan.

The respondent noted ongoing trade in CWC chemicals between the United

States and Taiwan and suggested that BXA adopt a country code.

Supplement 3 to the Declaration and Report Handbooks did include

Macedonia as The Former Yugoslavia Republic of Macedonia (code: MKD).

Consequently, BXA has not made any changes. BXA renamed Supplement No.

3 from ``Country Codes'' to ``Destination Codes.'' BXA also created a

new code for Taiwan (TAI) on Supplement Number 3, following the code

for Zimbabwe. This new code should be used to declare or report

transfers of Schedule 2 and 3 chemicals to or from Taiwan. Transfers to

Taiwan of Schedule 2 and 3 chemicals require an End-Use Certificate and

may also require an export license under the Export Administration

Regulations (EAR) (15 CFR 730-799) or the International Traffic and in

Arms Regulations (ITAR) (22 CFR 100-130). Note that effective April 29,

2000, transfers of Schedule 2 chemicals to or from Taiwan are

prohibited under the EAR and the CWCR.

Glossary of Terms. Two respondents recommended that BXA create a

glossary of common terms for use in completing declaration and report

forms. The respondents noted that without a glossary, industry would

constantly have to cross-reference the CWCR which is a time-consuming

process. BXA created a Glossary of Terms which will be designated as

Supplement 1 to each of the four Handbooks. Accordingly, Supplement 2

instructs industry how to determine the latitude and longitude of your

plant site, Supplement 3 is the Product Group Codes, and Supplement 4

is the Destination Codes.

Point of contact for declarations, reports and inspections. Two

respondents recommended that BXA change the term ``point of contact''

because it may create confusion when referring to individuals with

responsibilities for declaration and report questions or inspection

notifications. Both respondents recommended use of the terms

``declaration point of contact'' and ``inspection point of contact.''

One respondent also recommended that BXA give the option of listing up

to two

[[Page 73759]]

additional inspection contacts because one person may not be available

24 hours per day at the phone numbers provided. BXA changed the

appropriate forms to differentiate between the two types of point of

contacts: declaration and report point of contact and inspection point

of contact. BXA also changed the appropriate forms to allow an optional

inspection contact to be provided. Due to space constraints on the

forms, BXA was unable to allocate space for a third inspection contact

as requested by the respondent.

Product Group Codes. One respondent noted that industry may

possibly be confused with the requirements for Product Group Codes

because these codes combine classification of main activities by

feature and function. The respondent recommended that BXA clarify the

basis for selecting between the activities and suggested that industry

should select the single best descriptor of any activity, whether a

literal or functional descriptor, based on the company's representation

of the activity. BXA has changed Form 2-2 (question 2-2.5), Form 3-2

(question 3-2.5) and the UDOC Form (question UDOC.6) to alleviate any

possible confusion over what product group codes should be declared to

describe the activities at the plant or plant site. Product group codes

describe the type of ultimate or final products that are produced,

processed or consumed at the plant or plant site. The forms have been

changed to require that you provide one or more Standard International

Trade Classification (SITC) Code that describes the type of ultimate

products that are manufactured at the plant or plant site. If a plant

site chooses to provide only one product group code, it will be

accepted by BXA.

Plant Site and/or Plant names. One respondent noted that the forms

for Schedules 1, 2 and 3 as well as for UDOCs state that BXA will

assign a ``unique name'' to a declared plant site and/or plant. The

respondent recommended that BXA clarify that a plant site and/or plant

will have the same ``unique name'' across the different Schedules of

Chemicals as well as for UDOCs, so there is no confusion and multiple

``unique names'' are not assigned. BXA believes the respondent has

misinterpreted the instructions for assigning a ``unique name'' for the

plant site and/or plant. Each company assigns the ``unique name'' to

its plant site and plants, not BXA. Industry should be careful to

assign the same ``unique name'' to its plant site and plants regardless

of the Schedule of Chemicals under which the declaration or report is

being submitted. Upon receipt of a declaration or report, BXA will

assign a ``unique code'' to each plant site and all plants associated

with the plant site. These codes are referred to as the ``U.S. Code,''

which for plant sites, consists of the letters ``USC'' followed by five

digits (e.g., USC00123), and plants will have a three-digit extension

to the plant site code (e.g., USC00123-002). Industry should be careful

to provide the same location and description of the plant site and

plants to ensure that BXA will not mistakenly assign multiple codes.

BXA will inform industry in writing of its relevant U.S. Codes so that

it will be easier to identify the plant sites and plants during

discussions as well as for submission of subsequent declarations or

reports and recordkeeping purposes.

Confidential Business Information (CBI). One respondent noted that

none of the forms contains a question or a check box for companies to

indicate if Confidential Business Information (CBI) is included in the

declaration or report. The respondent noted that companies should have

the ability to inform BXA of which information it considers to be CBI

and recommended that BXA change the forms to allow for the designation

of CBI. CBI is governed by the provisions of part 718 of the CWCR.

Supplement No. 1 to part 718 identifies those fields on each form which

contain CBI as defined by the Act. If a company seeks additional CBI

protection for information in fields which are not listed in part 718

of the CWCR, it should provide a detailed explanation describing why

release of the information contained in those fields is a trade secret

and should not be released to the public. This explanation should be

attached to Form A.

Create a form to report undeclared status. One respondent

recommended that BXA create a form for industry to report that it has

ceased its declarable activities and is in an ``undeclared status''

capacity. It would be an additional burden on industry to submit a form

to BXA to report its ``undeclared status.'' If BXA does not receive a

declaration or report from a company that was previously declared, BXA

will conclude that the company has changed its status.

Add gray shading to forms. One respondent recommended that BXA add

gray shading on the top of all relevant forms where the plant site and

plant information is to be identified. The respondent noted that the

gray shading features help it to identify what information must be

completed. BXA has added the gray shading to all relevant forms.

Schedule 2 Forms

Schedule 2 Form 2-2--Activities of the Plant. Two respondents

requested that question 2-2.7 on Form 2-2 be changed to add a separate

selection for the activity type ``other'' and to also include the

question ``Is this plant dedicated to Schedule 2 activities? Yes/No.''

BXA deleted the word ``exclusively'' from question 2-2.7 and added a

separate selection for activity type ``other.'' BXA did not include the

question recommended by the respondent because it is not necessary.

Schedule 2 Form 2-2--Definition of Nameplate and Design Capacities.

Two respondents recommended that the definitions for ``nameplate

capacity'' and ``design capacity'' be clarified. One respondent noted

that industry's interpretation of these two definitions is synonymous

and the other respondent noted that nameplate capacity has many

different industrial meanings. One respondent also noted that the

production capacity was requested for all Schedule 2 chemicals at the

plant that were produced, processed, and/or consumed above the

applicable threshold but that the instructions were unclear if the

capacity should only be provided for chemicals that were produced. BXA

acknowledges that industry may have different definitions for

``nameplate capacity.'' However, for purposes of Schedule 2

declarations, the nameplate capacity definition remains unchanged and

the design capacity definition is clarified by stating that it is the

corresponding theoretically calculated product output, without test

data or other supportive plant specific information. BXA also clarified

the instruction to question 2-2.8 to state that you identify all

Schedule 2 chemicals produced, processed or consumed above the

applicable threshold, but that you only provide the production capacity

and calculation method for those chemicals which you produced.

Schedule 2 Annual Declarations on Anticipated Activities and

Declarations on Additionally Planned Activities. One respondent noted

that it may not be possible to be certain about the starting and ending

dates for production, processing or consumption of a Schedule 2

chemical as required in the Annual Declaration on Anticipated

Activities and, therefore, requested that BXA clarify the requirement

for approximate, not actual, start and end dates for submission of a

Declaration on Additionally Planned Activities. The respondent further

requested that BXA clarify that there is not a requirement for

submitting a second Declaration on

[[Page 73760]]

Anticipated Activities. Lastly, the respondent noted the long lead-time

for processing Schedule 2 and Schedule 3 Declarations on Anticipated

Activities and recommended BXA to shorten the time frame for submission

of the declaration from 21 days to 10 days.

For the Annual Declaration on Anticipated Activities, the time

periods when declared activities are anticipated to occur should be as

precise as possible, but should in any case be accurate to within a

three-month period. The declaration requirement in relation to these

periods does not necessarily mean that individual planned production,

processing, or consumption campaigns need to be declared, rather this

three-month period provides a flexible framework for declarations and

will reduce the number and frequency of Declarations on Additionally

Planned Activities. Since the requirement for declaring the anticipated

time periods for production, processing or consumption is already an

``approximate'' projection coupled with the three-month period for

completion of an activity, BXA does not believe it is necessary or

appropriate to state that additionally planned time periods are

``approximate.'' BXA did not add a clarification to Form 2-3C to state

that only one Declaration on Anticipated Activities is required to be

submitted. There may be situations in which a company submitted a

Declaration on Additionally Planned Activities to declare new or

changed anticipated production periods and it has further changes to

those production periods which are not covered by the three-month

period. BXA believes this will rarely occur, if ever. BXA has changed

Form 2-3C to include the types of changes that will require a

Declaration on Additionally Planned Activities. As previously noted,

BXA has changed the time-frame for submission of the Declaration on

Additionally Planned Activities from 21 days to 15 days.

Schedule 3 Forms

General changes to Schedule 3 Forms. One respondent recommended

that Form 3-3 be revised to require identification of the year being

reported. Two respondents recommended that an instruction be added

before question 3-3.1 to clarify the type of declaration or report to

which the question refers. Both respondents also recommended that new

types of ``purposes of production'' be added to Questions 3-3.1b and 3-

3.2b on Form 3-3, including inter-company transfers, as well as

transfers to the agricultural, manufacturing, construction,

pharmaceutical, and service or other industries. BXA has made the

instructional clarifications to Form 3-3. However, we did not change

Form 3-3 to require that the reporting years be identified because this

information is indicated on the Certification Form and only one Form 3-

3 per chemical, per year is included in the declaration package.

Conversely, for the Schedule 2 Initial Declaration, three Forms 2-3

must be submitted for each chemical for calendar years 1994, 1995, and

1996. Therefore, there is a clear need for the Schedule 2-3 Form to

identify the year of the data being reported. Separate Schedule 3

declarations must be submitted for the Initial Declaration (1996) and

the Annual Declarations on Past Activities for calendar years 1997,

1998, and 1999. The Certification Form for each of these declarations

will identify the year of the data declared. You cannot combine data

from several years into one declaration. This procedure is the same for

Initial Reports on Exports and Imports and Annual Reports on Exports

and Imports. BXA changed the purpose of production from ``transfer to

other company'' to ``transfer to other industry.'' BXA believes this

change broadens the scope of the purposes to cover all transfers.

Section 3 to the Schedule 3 Handbook. One respondent recommended

that Section 3 of the Schedule 3 Handbook outline the mixtures'

thresholds to assist industry in complying with its obligations. BXA

has added the mixture thresholds to Section 3 of the Schedule 3

Handbook as well as to the relevant sections of the Schedule 1 and 2

Handbooks. BXA also included the exemptions for UDOCs in the UDOC

Handbook.

Delete Structural Formula from Form 3-3. One respondent noted that

Form 3-3 unnecessarily includes a check box to indicate that a

structural formula is attached to the declaration or report. The

respondent noted that the list of Schedule 3 chemicals is well known

and identifiable and a structural formula would, therefore, not be

required. BXA has changed Form 3-3 to make the requirement optional for

submission of a Schedule 3 structural formula.

Exports and Imports of Schedule 2 and Schedule 3 Chemicals. One

respondent requested that Forms 2-3B and 3-3 address the applicable

threshold mixture for the export and import of Schedule 2 and Schedule

3 mixtures. The respondent also requested that Figure A on Forms 2-3B

and 3-3 distinguish between the applicable threshold for declaring and

reporting the chemical, including the mixture exemption, versus

exporting or importing the chemical. The respondent further recommended

that Forms 2-3B and 3-3 address the licensing or End-Use Certificate

requirements for exports to non-States Parties.

BXA did not reference the End-Use Certificate or license

requirements on the forms for the export of Schedule 2 or Schedule 3

chemicals to non-States Parties because these requirements are not

applicable to declarations or reports. Such requirements are contained

in Sec. 745.2 of the EAR, which states in part that U.S. exporters must

obtain an End-Use Certificate prior to the export of a Schedule 2 or 3

chemical to a non-State Party and to submit the Certificate to BXA.

This is in addition to, but separate from, any license requirement

under the EAR for such exports. BXA also did not change Figure A on

Forms 2-3B and 3-3 because of space constraints. However, BXA created

new tables in Section 3 of the Schedule 2 and Schedule 3 Report and

Declaration Handbooks that will assist industry in determining the

different thresholds that apply for declaration and reporting

requirements for Schedule 2 and Schedule 3 chemicals.

Unscheduled Discrete Organic Chemicals Forms

General changes to the declaration form for Unscheduled Discrete

Organic Chemicals (UDOCs). Two respondents requested that BXA clarify

question UDOC.7 of the UDOC Form or change it to ask for an

``estimate'' or the ``approximate'' number of plants on the plant site

producing UDOCs, including all PSF chemicals, instead of asking for the

actual number of plants. One respondent requested a clarification to

question UDOC.9 to request the ``approximate'' number of PSF plants at

the plant site that produced an individual PSF chemical over 30 metric

tons. This respondent also requested a clarification to question

UDOC.10.1-10.4 to indicate that the ``approximate'' number of PSF

plants whose aggregate production of all PSF chemicals falls within

each of the PSF-chemical production ranges.

BXA changed UDOC Form questions UDOC.7 and UDOC.10.1-10.4 to

require the ``approximate'' number of UDOC plants (including PSF

plants) and the ``approximate'' aggregate production of all PSF

chemicals, respectively. BXA did not change question UDOC.9 to require

the ``approximate'' number of PSF plants that produced an

``individual'' PSF chemical over 30 metric tons. Rather BXA changed

this question to require the ``exact'' number of PSF plants at the

plant site that produced an individual PSF chemical over 30 metric tons

because Part IX , paragraph 6, of the Convention's

[[Page 73761]]

Verification Annex states ``* * * specify the number of PSF-plants

within the plant site and include information on the approximate

aggregate amount of production for PSF-chemicals produced by each PSF-

plant in the previous calendar year expressed in ranges * * *'' BXA

believes that for PSF plants you must identify the exact number of

plants on your plant site, but you can provide the approximate amount

of PSF-chemicals produced by these plants.

Section 3--Exemptions--Unscheduled Discrete Organic Chemicals

Handbook. Two respondents noted that the Unscheduled Discrete Organic

Chemicals (UDOCs) Handbook did not appropriately list the exemptions

from declaration requirements and requested that BXA include all of the

exemptions that are listed in the CWCR. To assist industry in

determining its obligations for UDOC declarations, BXA is listing all

of the UDOC exemptions in Section 3 of the UDOC Handbook that are

listed in part 715 the CWCR. BXA reminds industry that where there are

any discrepancies between the requirements of the Handbooks and the

CWCR, the CWCR prevails.

Miscellaneous issues

Assistance on questions and chemical determinations. Two

respondents that requested BXA accept electronic requests for

assistance or chemical determinations via e-mail in addition to

telephone and fax requests. Both respondents noted that an electronic

mechanism for processing requests will enhance BXA's flexibility and

responsiveness to assist industry. One respondent requested BXA to

provide a chemical determination even if all of the required

information was not submitted. Lastly, one respondent requested BXA to

establish a provision or a clarification to Sec. 711.4 of the CWCR in

which any assistance given to a company by BXA that turns out to be

incorrect will not result in an enforcement action against the company

and should be considered release from any penalty. BXA agrees with the

respondents' request for an electronic means through which to seek

assistance and to submit chemical determinations, and has revised

Sec. 711.4 appropriately. BXA also revised Sec. 711.4 to identify the

type of information that should be submitted for a chemical

determination and established a provision for allowing facilities to

explain why there are ambiguities or deficiencies that preclude them

from supplying this information. BXA will make every effort to make a

determination based upon the submitted information, and only if this is

not possible will BXA return the request and identify what additional

information must be provided in order to complete the chemical

determination. For enforcement purposes, only a written response from

BXA is binding. Written advice applies only to the person or persons to

whom it is addressed.

Identification of the Owner and Operator of the facility. The

Department of State requested BXA to provide information on the owner

and operator, occupant or agent in charge of a facility or plant site

so that it can inform the owner and operator, occupant or agent in

charge in writing of an impending inspection as required by section 304

of the Act. Section 304 of the Act requires that the USNA notify, in

writing, the owner and the operator, occupant, or agent in charge of

the facility. In order to fulfill this legal requirement, BXA has

changed the appropriate forms and forms instructions to obtain the

telephone and facsimile numbers for both the owner and the operator,

occupant, or agent in charge of a facility.

Chemicals Produced for Chemical Weapons Purposes. One respondent

recommended that Question 2-4.2 on Form 2-4 and Question 3-4.2 on Form

3-4 should be revised to require the identification of the final

chemical weapon (CW) product, if known, or the Scheduled Chemical name,

if known. The respondent cited difficulties industry may have in

identifying the final CW product because of the confidential and

proprietary nature of commercial production records, availability of

records, and terms of mergers, acquisition or internal restructuring.

Forms 2-4 and 3-4 (questions and instructions) already instruct

industry to provide the final product or chemical, if this information

is known. Therefore, no changes were made to these forms.

IV. Part-by-Part Analysis

The Chemical Weapons Convention Regulations (CWCR) will include 13

parts, as follows:

Part 710--General Information and Overview of the CWCR. This part

includes general information about the Convention, definitions of terms

used in the CWCR, an overview of Scheduled chemicals and examples of

affected industries. States Parties to the Convention are listed in

Supplement No. 1 to part 710 of the CWCR. This part also briefly

describes the declaration, reporting, and inspection provisions of the

Convention.

Part 711--General Information Regarding Declaration, Reporting, and

Notification Requirements. This part provides an overview of

declaration and other reporting requirements, who is responsible for

declarations and reports, and where to get assistance, forms and

handbooks. The Convention requires an initial declaration and report

and subsequent annual declarations and reports for activities involving

specified amounts of certain chemicals. If, after reviewing parts 712

through 715, you determine that you have declaration and/or reporting

requirements, you may obtain the appropriate forms by contacting the

Bureau of Export Administration (BXA). Note that in instances where a

declaration or report is required, the operator of a facility required

to declare or report under the CWCR is responsible for the submission

of all required forms in accordance with all applicable provisions of

the CWCR. Also note that the Act defines and provides for the

protection of confidential business information obtained pursuant to

the CWCR.

Part 712--Activities involving Schedule 1 Chemicals. This part

prohibits imports of Schedule 1 chemicals from non-States Parties and

imports from States Parties for purposes other than research, medical,

pharmaceutical, or protective purposes. (Part 712 also cross-references

similar export restrictions on Schedule 1 chemicals set forth in the

Export Administration Regulations.) This part also describes

declaration and other reporting requirements for activities involving

Schedule 1 chemicals, including production, use (consumption), exports,

imports, domestic transfers and storage of any quantity of Schedule 1

chemicals. This part provides that facilities that produce more than

100 grams aggregate of Schedule 1 chemicals in a calendar year are

considered Schedule 1 ``declared'' facilities. Facility-specific

information on ``declared facilities'' will be forwarded to the

Organization for the Prohibition of Chemical Weapons (OPCW) and all

Schedule 1 ``declared'' facilities will be subject to routine on-site

inspection by the OPCW. Finally, this part requires advance

notification of all exports and imports of Schedule 1 chemicals to or

from other States Parties, and planned changes related to the initial

declaration. Note that BXA published an interim rule in the Federal

Register on May 18, 1999 (64 FR 27138), amending the Export

Administration Regulations (EAR) to implement the export control

provisions of the CWC that are subject to Department of Commerce

jurisdiction. The EAR also require prior notification of all exports

[[Page 73762]]

of Schedule 1 chemicals and annual reports of exports of such

chemicals. Schedule 1 chemicals are included in Supplement No. 1 to

this part.

Part 713--Activities involving Schedule 2 Chemicals. This part

prohibits imports of any Schedule 2 chemical on or after April 29,

2000, from any destination that is not a party to the Convention,

except for mixtures containing 10 percent or less of a Schedule 2

chemical. (Part 713 cross-references similar export restrictions on

Schedule 2 chemicals in the EAR.) This part also describes declaration

and other reporting requirements for activities involving Schedule 2

chemicals, including production of any amount of a Schedule 2 chemical

at any time since January 1, 1946, for chemical weapons purposes;

production, processing, or consumption of a Schedule 2 chemical in

excess of specified quantities; and exports and imports of a Schedule 2

chemical in excess of specified quantities. Further, this part requires

declarations on anticipated production, processing, or consumption in

the next calendar year of a Schedule 2 chemical in excess of specified

quantities as well as certain additionally planned production,

processing or consumption activities. Declaration and reporting

requirements apply also to Schedule 2 chemicals contained in mixtures.

Note, however, that the quantity of a Schedule 2 chemical contained in

a mixture must be counted for declaration and report purposes only if

the concentration of the Schedule 2 chemical in the mixture is 30% or

more by volume or by weight, whichever yields the lesser percent.

If the Schedule 2 chemical in a mixture equals or exceeds the

stated percentage concentration, you must count only the amount

(weight) of the Schedule 2 chemical in the mixture, not the total

weight of the mixture. Schedule 2 chemicals are included in Supplement

No. 1 to this part.

Part 714--Activities involving Schedule 3 Chemicals. This part

describes declaration and other reporting requirements for activities

involving Schedule 3 chemicals, including production of any amount of a

Schedule 3 chemical at any time since January 1, 1946, for chemical

weapons purposes; production of a Schedule 3 chemical in excess of

specified quantities; and exports and imports of a Schedule 3 chemical

in excess of specified quantities. Further, this part requires

declaration of anticipated production in the next calendar year of a

Schedule 3 chemical in excess of specified quantities as well as

certain additionally planned production activities. Declaration and

reporting requirements apply also to Schedule 3 chemicals contained in

mixtures. Note, however, that the quantity of a Schedule 3 chemical

contained in a mixture must be counted for declaration and reporting

purposes only if the concentration of the Schedule 3 chemical in the

mixture is 80% or more by volume or by weight, whichever yields the

lesser percent. If the mixture contains 80 percent or more of the

Schedule 3 chemical, you must count only the amount (weight) of the

Schedule 3 chemical contained in the mixture, not the total weight of

the mixture. Schedule 3 chemicals are included in Supplement No. 1 to

this part.

Part 715--Activities involving Unscheduled Discrete Organic

Chemicals (UDOCs). This part describes declaration requirements for the

production of UDOCs in excess of specified quantities. However, note

that declarations are not required for certain chemicals and chemical

mixtures, including those produced through a biological or bio-mediated

process; polymers and oligomers; certain synthetic mixtures of organic

chemicals; unscheduled discrete organic chemicals produced

coincidentally as byproducts of a manufacturing or production process

that are not isolated or captured for use or sale during the process

and are routed to, or escape from, the waste stream of a stack,

incinerator, or wastewater treatment system or any other waste stream;

or products from the refining of crude oil, including sulfur-containing

crude oil.

Part 716--Inspections. This part implements the inspection

provisions of the Convention, consistent with the Act. It describes

notification procedures, the responsibilities of the Department of

Commerce as host and escort for inspections, types of inspections, and

scope and conduct of inspections. The United States National Authority

(USNA) will provide written notification to the owner and operator,

occupant or agent in charge of the premises to be inspected. BXA will

provide Host Team notice to the inspection point of contact identified

in declaration forms submitted by the facility. This part also

describes the duration and frequency of inspections, and the role of a

facility agreement. A facility agreement is a site-specific agreement

between the U.S. Government and the Organization for the Prohibition of

Chemical Weapons. The purpose for a facility agreement is to define the

inspection scope and procedures for a given facility under the

Convention and to facilitate future inspections of the facility by

enhancing efficiency and predictability and reducing preparation costs

for the facility. The U.S. Government and the OPCW will begin

negotiating such facility agreements during the initial inspections of

facilities that require facility agreements pursuant to the Convention

and Act, and for additional declared facilities that request a facility

agreement pursuant to the Act. Supplement Nos. 2 and 3 include model

facility agreements for Schedule 1 and Schedule 2 facilities,

respectively.

Part 717--Clarification and challenge inspection procedures. This

part describes clarification procedures under the Convention and the

scope and purpose of on-site challenge inspections. On-site challenge

inspections may be conducted at any facility or location in the United

States for the sole purpose of clarifying and resolving any questions

concerning possible non-compliance with the provisions of the CWC. The

USNA will provide written notification of a challenge inspection to the

owner and operator, occupant or agent in charge of the premises. The

Department of Commerce will provide Host Team notification to the

inspection point of contact of a declared facility, or to the owner or

occupant of an facility that has not been declared under the

declaration requirements of the Convention.

Part 718--Confidential business information (CBI). This part sets

forth the identification and treatment of CBI as defined in the Act.

Part 719--Enforcement. This part sets forth the civil and criminal

penalties and enforcement procedures that apply to violations of the

reporting and inspections requirements and provisions relating to the

importation of Schedule 1 and 2 chemicals.

Part 720--Denial of export privileges. This part sets forth a

penalty, denial of export privileges, that applies to persons convicted

under 18 U.S.C. 229.

Part 721--Inspection of records and recordkeeping. This part

includes the recordkeeping requirements of the CWCR, including

retention and reproduction requirements.

Part 722--Interpretations. This part is reserved for future use. It

will provide explanations and examples for declaration requirements and

other interpretations to guide industry and other U.S. persons in

determining obligations under the CWCR.

Comments on this interim rule must be submitted to BXA by January

31, 2000. Send comments to: the Regulatory Policy Division, Bureau of

Export Administration, Room 2705, 14th Street and Pennsylvania Ave.,

N.W., Washington, D.C. 20230.

[[Page 73763]]

Rulemaking Requirements

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

purposes of E.O. 12866.

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

required to, nor shall any person be subject to a penalty for failure

to comply with a collection of information, subject to the Paperwork

Reduction Act (PRA), unless that collection of information displays a

currently valid OMB Control Number. This rule revises an existing

collection of information requirement subject to the Paperwork

Reduction Act of 1995 (44 U.S.C. 3501 et seq.), which the Office of

Management and Budget has approved and reinstated under OMB Collection

No. 0694-0091 (December 1999). The public reporting burdens for the new

collections of information are estimated to average 10.6 hours for

Schedule 1 Chemicals, 11.9 hours for Schedule 2 chemicals, 2.5 hours

for Schedule 3 chemicals, 5.3 for Unscheduled Discrete Organic

Chemicals, and .17 hours for Schedule 1 notifications. It is estimated

to take approximately 1.18 hours to complete each of the nine Schedule

1 forms, 1.19 hours for each of the ten Schedule 2 forms, .36 hours for

each of the seven Schedule 3 forms, and 1.33 hours for each of the four

Unscheduled Discrete Organic Chemicals forms. The burden hours

associated with completing a particular type of declaration or report

package (e.g., Schedule 1 initial declaration, Schedule 2 annual

declaration on past activities) will change depending on the number of

forms required to comply with the specific declaration or report

requirement. Table 1 to Parts 712, 713, 714, and 715 of the CWCR

identifies the specific forms which must be included in each type

declaration or report package. The Declaration and Report Handbooks

include a ``Guide to Submission of Forms'' which also identifies the

specific forms that must be included in a declaration or report

package. To calculate the number of hours it takes to complete a

specific type of declaration or report, multiply the number of forms

required for a specific declaration or report type by the number of

hours estimated to complete each form.

BXA will use the information contained in declarations and reports

submitted by U.S. persons to compile the U.S. National Industrial

Declaration in order to meet our obligations under the Chemicals

Weapons Convention. BXA will submit the U.S. National Industrial

Declaration to the United States National Authority who will forward

the Declaration to the Organization on the Prohibition of Chemical

Weapons as required by the Convention.

3. This rule does not contain policies with Federalism implications

sufficient to warrant preparation of a Federalism assessment under

Executive Order 13132.

4. BXA completed a Cost Benefit Analysis (CBA) pursuant to

Executive Order 12866 and an Initial Regulatory Flexibility Analysis

(IRFA) pursuant to 5 U.S.C. 603 for the proposed rule, and requested

comments from the public. BXA received no comments from the public on

either the CBA or the IRFA. Therefore, BXA is using the analysis of the

IRFA and the CBA, with certain edits to make it consistent with this

interim rule, for the Final Regulatory Flexibility Analysis (FRFA)

required by 5 U.S.C. 604. A summary of the FRFA and CBA follows. The

CBA and the FRFA are available on BXA's website at www.cwc.gov. Copies

of the CBA and the complete FRFA may be obtained from the Bureau of

Export Administration Freedom of Information Officer, Bureau of Export

Administration Freedom of Information Records Inspection Facility, Room

6883, Department of Commerce, 14th Street and Pennsylvania Avenue, NW,

Washington, DC 20230 or by calling (202) 482-0500.

The FRFA identifies the Small Business Administration's (SBA) small

business size standards, in terms of number of employees, for

``Chemicals and Allied Products'' by four-digit Standard Industrial

Classification (SIC) codes. These SBA standards indicate that a ``small

business'' in the chemical industry can cover a range of sizes, from up

to 500 employees to up to 1,000 employees. The FRFA states that BXA

does not have information on which SIC code categories will include

companies that are subject to the declaration, reporting, notification

or inspection requirements of this rule, and therefore, BXA is unable

to estimate with certainty the number of small businesses that will be

affected by this rule. BXA anticipates some 2,000 firms will be

affected by the CWCR, and many of them may have no more than 500

employees, thus falling under the SBA generic definition of ``small

business.''

The FRFA and the CBA report BXA's estimate that compliance with the

requirements of this rule will total approximately $377,654 to gather

and maintain relevant data and to fill out declarations, reports and

notifications, and approximately $2,166,880 for inspections. The

average cost of an inspection, based on the assumption that 40

facilities will undergo inspections each year, is $54,150. The FRFA and

CBA describe the expected benefits to the United States of implementing

the requirements of the Convention, including increased national and

economic security.

The FRFA explains that BXA's discretion in formulating the

declaration, reporting and notification requirements of this rule is

limited by the Convention. The OPCW has issued forms for States Parties

to use for declarations. In drafting the CWCR requirements and the

forms for U.S. persons to use, BXA has consistently interpreted the

Convention's requirements as narrowly as possible to ensure that only

information that the United States National Authority must declare to

the OPCW is to be submitted to BXA. Other States Parties, such as

Canada, have imposed much broader reporting requirements on their

industries, with the government taking on the responsibility of

determining which of the information collected must be declared to the

OPCW. In addition, certain declaration requirements of the Convention

are subject to interpretation by States Parties. Until the Conference

of States Parties establishes clear rules for these requirements,

States Parties may use their ``national discretion'' to implement them.

``National discretion'' generally means a reasonable interpretation of

the requirement. For requirements currently subject to ``national

discretion,'' BXA has adopted in this rule the minimum requirements

consistent with a reasonable reading of the Convention, keeping in mind

its purposes and objectives.

List of Subjects

15 CFR Part 710

Chemicals, Exports, Foreign Trade, Imports, Treaties.

15 CFR Part 711

Chemicals, Confidential business information, Reporting and

recordkeeping requirements.

15 CFR Part 712

Chemicals, Exports, Foreign Trade, Imports, Reporting and

recordkeeping requirements.

15 CFR Part 713

Chemicals, Exports, Foreign Trade, Imports, Reporting and

recordkeeping requirements.

15 CFR Part 714

Chemicals, Exports, Foreign Trade, Imports, Reporting and

recordkeeping requirements.

[[Page 73764]]

15 CFR Part 715

Chemicals, Exports, Foreign Trade, Imports, Reporting and

recordkeeping requirements.

15 CFR Part 716

Chemicals, Confidential business information, Reporting and

recordkeeping requirements, Search warrants, Treaties.

15 CFR Part 717

Chemicals, Confidential business information, Reporting and

recordkeeping requirements, Search warrants, Treaties.

15 CFR Part 718

Confidential business information, Reporting and recordkeeping

requirements.

15 CFR Part 719

Administrative proceedings, Exports, Imports, Penalties,

Violations.

15 CFR Part 720

Penalties, violations.

15 CFR Part 721

Reporting and recordkeeping requirements.

1. In 15 CFR, Chapter VII, Subchapter B is designated as Chemical

Weapons Convention Regulations.

2. In 15 CFR, Subchapter B, Parts 710 through 722 are added to read

as follows:

PART 710--GENERAL INFORMATION AND OVERVIEW OF THE CHEMICAL WEAPONS

CONVENTION REGULATIONS (CWCR)

Sec.

710.1 Definitions of terms used in the Chemical Weapons Convention

Regulations (CWCR).

710.2 Scope of the CWCR.

710.3 Purposes of the Convention and CWCR.

710.4 Overview of scheduled chemicals and examples of affected

industries.

710.5 Authority.

710.6 Relationship between the Chemical Weapons Convention

Regulations and the Export Administration Regulations.

Supplement No. 1 to Part 710--States Parties to the Convention on the

Prohibition of the Development, production, Stockpiling and Use of

Chemical Weapons and on Their Destruction

Authority: 22 U.S.C. 6701 et seq.; E.O. 13128, 64 FR 36703.

Sec. 710.1 Definitions of terms used in the Chemical Weapons

Convention Regulations (CWCR).

The following are definitions of terms used in the CWCR (parts 710

through 722 of this subchapter, unless otherwise noted):

Act (The): Means the Chemical Weapons Convention Implementation Act

of 1998 (22 U.S.C. 6701 et seq.).

Bureau of Export Administration (BXA). Means the Bureau of Export

Administration of the United States Department of Commerce, including

the Office of Export Administration and the Office of Export

Enforcement.

By-product. Means any chemical substance or mixture produced

without a separate commercial intent during the manufacture,

processing, use or disposal of another chemical substance or mixture.

Chemical Weapon. Means the following, together or separately:

(1) A toxic chemical and its precursors, except where intended for

purposes not prohibited under the Chemical Weapons Convention (CWC),

provided that the type and quantity are consistent with such purposes;

(2) A munition or device, specifically designed to cause death or

other harm through the toxic properties of those toxic chemicals

specified in paragraph (1) of this definition, which would be released

as a result of the employment of such munition or device; or

(3) Any equipment specifically designed for use directly in

connection with the employment of munitions or devices specified in

paragraph (2) of this definition.

Chemical Weapons Convention (CWC or Convention). Means the

Convention on the Prohibition of the Development, Production,

Stockpiling and Use of Chemical Weapons and on Their Destruction, and

its annexes opened for signature on January 13, 1993.

Chemical Weapons Convention Regulations (CWCR). Means the

regulations contained in 15 CFR parts 710 through 722.

Consumption. Consumption of a chemical means its conversion into

another chemical via a chemical reaction. Unreacted material must be

accounted for as either waste or as recycled starting material.

Declaration or report form. Means a multi-purpose form due to BXA

regarding activities involving Schedule 1, Schedule 2, Schedule 3, or

unscheduled discrete organic chemicals. Declaration forms will be used

by facilities that have data declaration obligations under the CWCR and

are ``declared'' facilities whose facility-specific information will be

transmitted to the OPCW. Report forms will be used by entities that are

``undeclared'' facilities or trading companies that have limited

reporting requirements for only export and import activities under the

CWCR and whose facility-specific information will not be transmitted to

the OPCW. Information from declared facilities, undeclared facilities

and trading companies will also be used to compile U.S. national

aggregate figures on the production, processing, consumption, export

and import of specific chemicals. See also related definitions of

declared facility, undeclared facility and report.

Declared facility or plant site. Means a facility or plant site

required to complete data declarations of activities involving Schedule

1, Schedule 2, Schedule 3, or unscheduled discrete organic chemicals

above specified threshold quantities. Only certain declared facilities

and plant sites are subject to routine inspections under the CWCR.

Plant sites that produced either Schedule 2 or Schedule 3 chemicals for

CW purposes at any time since January 1, 1946, are also ``declared''

plant sites. However, such plant sites are not subject to routine

inspection if they are not subject to declaration requirements because

of past production, processing or consumption of Scheduled or

unscheduled discrete organic chemicals above specified threshold

quantities.

Discrete organic chemical. Means any chemical belonging to the

class of chemical compounds consisting of all compounds of carbon,

except for its oxides, sulfides, and metal carbonates, identifiable by

chemical name, by structural formula, if known, and by Chemical

Abstract Service registry number, if assigned.

Domestic transfer. Means, with regard to declaration requirements

for Schedule 1 and chemicals under the CWCR, any movement of any amount

of Schedule 1 chemical outside the geographical boundary of a facility

in the United States to another destination in the United States, for

any purpose. Domestic transfer includes movement between two divisions

of one company or a sale from one company to another. Note that any

movement to or from a facility outside the United States is considered

an export or import for reporting purposes, not a domestic transfer.

EAR. Means the Export Administration Regulations (15 CFR parts 730

through 799).

Explosive. Means a chemical (or a mixture of chemicals) that is

included in Class 1 of the United Nations Organization hazard

classification system.

Facility. Means any plant site, plant or unit.

Facility agreement. Means a written agreement or arrangement

between a State Party and the Organization relating

[[Page 73765]]

to a specific facility subject to on-site verification pursuant to

Articles IV, V, and VI of the Convention.

Host Team. Means the U.S. Government team that accompanies the

inspection team from the Organization for the Prohibition of Chemical

Weapons during a CWC inspection for which the regulations in this

subchapter apply.

Host Team Leader. Means the representative from the Department of

Commerce who heads the U.S. Government team that accompanies the

Inspection Team during a CWC inspection for which the regulations in

this subchapter apply.

Hydrocarbon. Means any organic compound that contains only carbon

and hydrogen.

Impurity. Means a chemical substance unintentionally present with

another chemical substance or mixture.

Inspection Team. Means the group of inspectors and inspection

assistants assigned by the Director-General of the Technical

Secretariat to conduct a particular inspection.

ITAR. Means the International Traffic in Arms Regulations (22 CFR

parts 120 through 130).

Organization for the Prohibition of Chemical Weapons (OPCW). Means

the international organization, located in The Hague, the Netherlands,

that administers the CWC.

Person. Means any individual, corporation, partnership, firm,

association, trust, estate, public or private institution, any State or

any political subdivision thereof, or any political entity within a

State, any foreign government or nation or any agency, instrumentality

or political subdivision of any such government or nation, or other

entity located in the United States.

Plant. Means a relatively self-contained area, structure or

building containing one or more units with auxiliary and associated

infrastructure, such as:

(1) Small administrative area;

(2) Storage/handling areas for feedstock and products;

(3) Effluent/waste handling/treatment area;

(4) Control/analytical laboratory;

(5) First aid service/related medical section; and

(6) Records associated with the movement into, around, and from the

site, of declared chemicals and their feedstock or product chemicals

formed from them, as appropriate.

Plant site. Means the local integration of one or more plants, with

any intermediate administrative levels, which are under one operational

control, and includes common infrastructure, such as:

(1) Administration and other offices;

(2) Repair and maintenance shops;

(3) Medical center;

(4) Utilities;

(5) Central analytical laboratory;

(6) Research and development laboratories;

(7) Central effluent and waste treatment area; and

(8) Warehouse storage.

Precursor. Means any chemical reactant which takes part, at any

stage in the production, by whatever method, of a toxic chemical. The

term includes any key component of a binary or multicomponent chemical

system.

Processing. Means a physical process such as formulation,

extraction and purification in which a chemical is not converted into

another chemical.

Production. Means the formation of a chemical through chemical

reaction.

Purposes not prohibited by the CWC. Means the following:

(1) Any peaceful purpose related to an industrial, agricultural,

research, medical or pharmaceutical activity or other activity;

(2) Any purpose directly related to protection against toxic

chemicals and to protection against chemical weapons;

(3) Any military purpose of the United States that is not connected

with the use of a chemical weapon and that is not dependent on the use

of the toxic or poisonous properties of the chemical weapon to cause

death or other harm; or

(4) Any law enforcement purpose, including any domestic riot

control purpose and including imposition of capital punishment.

Report. Means information due to BXA on exports and imports of

Schedule 1, Schedule 2 or Schedule 3 chemicals above applicable

thresholds. Such information is included in the national aggregate

declaration transmitted to the OPCW. Facility-specific information is

not included in the national aggregate declaration. Note: This

definition does not apply to parts 719 and 720 (see Sec. 719.1) of this

subchapter.

Schedules of Chemicals. Means specific lists of toxic chemicals,

groups of chemicals, and precursors contained in the CWC. See

Supplements No. 1 to parts 712 through 714 of this subchapter.

State Party. Means a country for which the CWC is in force. See

Supplement No. 1 to this part.

Storage. For purposes of Schedule 1 chemical reporting, means any

quantity that is not accounted for under the categories of production,

export, import, consumption or domestic transfer.

Synthesis. Means production of a chemical from its reactants.

Technical Secretariat. Means the organ of the OPCW charged with

carrying out administrative and technical support functions for the

OPCW, including carrying out the verification measures delineated in

the CWC.

Toxic Chemical. Means any chemical which, through its chemical

action on life processes, can cause death, temporary incapacitation, or

permanent harm to humans or animals. The term includes all such

chemicals, regardless of their origin or of their method of production,

and regardless of whether they are pro

This text is long and has been trimmed here. Open the source document for the complete record.