BIS Final Rule Amends EAR to Reflect Changes to the MTCR Annex, Bulgaria's New Membership in the MTCR, Additions to the Entity List, Etc

The Bureau of Industry and Security (BIS) has issued a final rule, effective March 10, 2005, which amends the Export Administration Regulations (EAR), as follows:

EAR Amended to Reflect October 2004 MTCR Plenary Agreements, Etc.

According to BIS, this final rule makes the following revisions to the EAR to reflect changes to the Missile Technology Control Regime (MTCR) Annex agreed to at the October 2004 Plenary in Seoul, South Korea and to reflect the new membership of Bulgaria in the MTCR:

EAR amended to reflect Bulgaria's new membership in MTCR. As a result of Bulgaria becoming a member of the MTCR, the entry for Bulgaria in Country Group A (Supplement No. 1 to 15 CFR Part 740) is revised by inserting an "X" in the box under column [A:2](Missile Technology Control Regime).

Definition of "usable in" & "capable of" in MTCR context expanded. This final rule amends 15 CFR Part 772 to revise the definition for "Usable in" or "Capable of" (MTCR context) to now include "usable for" and "usable as" in the list of terms that are defined by this definition.

In addition, the first sentence of this definition is revised to read "Equipment, parts, components, materials or 'software' which are suitable for a particular purpose" rather than "Equipment, parts, components or 'software' that are suitable for a particular purpose."

Amendments to certain ECCNs in the CCL. According to BIS, this final rule amends the Commerce Control List (CCL) (15 CFR Part 774) to reflect changes to the MTCR Annex agreed to at the October 2004 Plenary in Seoul, South Korea.

Changes to three ECCNs are expected to result in some increase in licensing activity; however, the majority of these amendments reflect clarifications to the CCL that will result in no actual change to the control parameters of the affected ECCNs.

The following ECCNs are affected (see final rule for a discussion of the amendments):

Four Syrian Entities Added to Entity List

BIS states that this final rule also adds four entities located in Syria to the Entity List (Supplement No. 4 to 15 CFR Part 744). According to BIS, this notifies the public that a license is required for the export or reexport of all items subject to the EAR to the Higher Institute of Applied Science and Technology (HIAST); Industrial Establishment of Defense (IED); National Standards and Calibration Laboratory (NSCL); and the Scientific Studies and Research Center (SSRC).

According to BIS, license applications to export or reexport items subject to the EAR to these entities will be reviewed with a presumption of denial.

Missile Catch-All Controls for Restrictions on Certain Rocket Systems Revised

According to BIS, this final rule revises the missile catch-all controls for Restrictions on Certain Rocket Systems by clarifying in 15 CFR 744.3(a)(2) that the general prohibition includes a license requirement for items that will be used, anywhere in the world (except by governmental programs for nuclear weapons delivery of NPT Nuclear Weapons States that are also members of NATO) in "the design, development, production or use of" rocket systems or unmanned air vehicles, regardless of range capabilities, for the delivery of chemical, biological, or nuclear weapons.

BIS notes that this is a clarification of its November 8, 2004 interim rule. (See ITT's Online Archives or 11/18/04 news, 04111830, for BP summary.)

Savings Clause

BIS states that shipments of items removed from eligibility for a license exception or export or reexport without a license (No License Required (NLR)) as a result of this final rule that were on dock for loading, on lighter, laden aboard an exporting or reexporting carrier, or en route aboard a carrier to a port of export or reexport, on March 10, 2005, pursuant to actual orders for export or reexport to a foreign destination, may proceed to that destination under the previous eligibility for a license exception or export or reexport without a license (NLR) so long as they have been exported or reexported from the U.S. before April 11, 2005. Any such items not actually exported or reexported before midnight on April 11, 2005 require a license in accordance with this final rule.

BIS contact - Steven Clagett (202) 482-1641

BIS final rule (D/N 050218043-5043-01, FR Pub 03/10/05) available at http://a257.g.akamaitech.net/7/257/2422/01jan20051800/edocket.access.gpo.gov/2005/pdf/05-4626.pdf