BIS Final Rule Revises CCL to Conform With Wassenaar Changes, Addition/Expansion of Unilateral U.S. Controls, Etc. (Part II)

The Bureau of Industry and Security (BIS) has issued a final rule, effective July 15, 2005, which revises certain entries on the Commerce Control List (CCL) that are controlled for national security reasons in Categories 1, 2, 3, 4, 5 Part I (telecommunications), 6, 7, 8, and 9, and definitions to conform with changes in the Wassenaar Arrangement's List of Dual-Use Goods and Technologies and Statements of Understanding maintained and agreed to by governments participating in the Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies (Wassenaar Arrangement).

In addition, this final rule adds Slovenia to the list of Wassenaar member countries in the EAR. This final rule also adds or expands unilateral U.S. controls on certain items consistent with the amendments made to implement the Wassenaar Arrangement's decisions.

This is Part II of a multi-part series of summaries on this BIS final rule. Part II focuses on the additional of Slovenia to the Wassenaar Arrangement as well as certain new and expanded export controls. See future issues of ITT for additional summaries.

Slovenia Became Wassenaar Arrangement Participating State in December 2004

Slovenia was welcomed as a new Participating State to the Wassenaar Arrangement at the December 2004 Plenary Meeting. To reflect this change, this rule adds Slovenia to the list of Wassenaar Arrangement member Countries in Supplement No. 1 to 15 CFR part 743.

Final Rule Imposes New & Expanded Export Controls

According to BIS, new and expanded export controls are imposed by this final rule as follows:

New or expanded antiterrorism (AT) controls imposed by this rule. BIS' final rule imposes a unilateral U.S. license requirement to export and reexport commodities (and related software and technology) controlled under ECCNs 6A001.a.2.a.3.b, 6A001.a.2.a.3.c, 6A001.a.2.a.6, 6A002.a.3.f, 6A003.b.4.b, 7A002.b for AT reasons to Cuba, Iran, Libya, North Korea, Sudan and Syria, in addition to the national security controls imposed to implement the Wassenaar Arrangement's decisions. There is a general policy of denial for applications to terrorism supporting countries, as set forth in 15 CFR part 742. In addition, certain of these countries are also subject to embargoes, as set forth in 15 CFR part 746. A license is also required for the export and reexport of these items to specially designated terrorists and foreign terrorist organizations, as set forth in 15 CFR part 744; license applications to these parties are reviewed under a general policy of denial.

New or expanded regional security (RS) controls. This final rule also imposes a unilateral U.S. license requirement to export and reexport commodities (and related technology) controlled under ECCNs 6A002.a.3.f and 6A003.b.4.b for RS reasons to all countries, except Canada, in addition to the national security controls imposed to implement the Wassenaar Arrangement's decisions. These destinations have an "X'' indicated in RS column 1 on the Commerce Country Chart of Supplement No. 1 to 15 CFR part 738.

BIS states that applications to export and reexport these commodities will be reviewed on a case-by-case basis to determine whether the export or reexport could contribute directly or indirectly to any country's military capabilities in a manner that would alter or destabilize a region's military balance contrary to the foreign policy interests of the U.S. For designated terrorism-supporting countries, the applicable licensing policies are found in 15 CFR parts 742 and 746.

New or expanded United Nations (UN) controls. This final rule also imposes a license requirement to export and reexport commodities (and related technology) controlled under ECCN 6A002.a.3.f for UN reasons to Rwanda in addition to the national security controls imposed to implement the Wassenaar Arrangement's decisions. The U.S. Government has a general policy of denial for export or reexport of certain items, including 6A002.a.3, to Rwanda.

However, proposed exports or reexports to the Government of Rwanda are reviewed on a case-by-case basis. The implementation of UN controls under 6A002.a.3.f, indirectly expands the UN controls under ECCNs 6A003.b.4, 6E001, and 6E002.

New or expanded National Security (NS) Column 2 controls. BIS states that this final rule imposes a license requirement under 15 CFR 742.4(a) for exports and reexports of commodities (and related software and technology) described in ECCNs 6A001.a.2.a.3.b, 6A001.a.2.a.3.c, 6A001.a.2.a.6, 6A002.a.3.f, and 6A003.b.4.b to all destinations that are not Country Group A:1 or cooperating countries (see Supplement No. 1 to 15 CFR part 740).

These destinations have an "X'' indicated in NS column 2 on the Commerce Country Chart of Supplement No. 1 to 15 CFR part 738. The purpose of the controls is to ensure that these items do not make a contribution to the military potential that would prove detrimental to the national security of the U.S.

New or expanded National Security (NS) Column 1 controls. BIS' final rule imposes a license requirement under 15 CFR 742.4(a) for exports and reexports of commodities (and related software and technology) described in ECCN 7A002.b to all destinations, except Canada. These destinations have an X'' indicated in NS column 1 on the Commerce Country Chart of Supplement No. 1 to 15 CFR part 738. The purpose of the controls is to ensure that these items do not make a contribution to the military potential that would prove detrimental to the national security of the U.S.

According to BIS, the licensing policy for national security controlled items exported or reexported to any country except a country in Country Group D:1 (see Supplement No. 1 to 15 CFR part 740) is to approve applications unless there is a significant risk that the items will be diverted to a country in Country Group D:1. The general policy for exports and reexport of items to Country Group D:1 is to approve applications when BIS determines, on a case-by-case basis, that the items are for civilian use or would otherwise not make a significant contribution to the military potential of the country of destination that would prove detrimental to the national security of the United States.

(See ITT's Online Archives or 07/19/05 news, 05071930, for Part I of BP summary.)

BIS final rule (D/N 050607153-5153-01, FR Pub 07/15/05) available at http://a257.g.akamaitech.net/7/257/2422/01jan20051800/edocket.access.gpo.gov/2005/pdf/05-13581.pdf.