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

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 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 III of a multi-part series of summaries on this BIS final rule. Part III focuses on the amendments to CCL Category 1 (Materials, Chemicals, "Microorganisms," and Toxins) as well as CCL Category 2 (Materials Processing).

The ECCNs affected, as described below, are 1C008, 2B001, 2B005, 2B006, 2B201, 3A001, 3A001, 3A002, 3B001, 3B002, 3B991, 3B992, 4D001, 4E001, 5A001, 6A001, 6A002, 6A003, 6A006, 6A993, 6A996, 6E001, 6E002, 6E003, 6E991, 6E993, 7A002, 7A007, 8A002, and 9A001.See future issues of ITT for additional summaries.

Amendments to Category 1- Materials, Chemicals, "Microorganisms,'' and Toxins

According to BIS, ECCN 1C008 is amended by:

(a) Deleting the phrase "determined using the dry method described in ASTM D 3418'' from 1C008.a.4;

(b) Replacing the phrase "ASTM D-648, method A'' with the phrase "ISO 75-3 (2004)'' in 1C008.b;

(c) Adding the phrase "having a glass transition temperature (Tg) exceeding 513 K (240 [deg]C)'' to the end of 1C008.f; and

(d) Replacing the phrase "ASTM D 3418 using the dry method'' with the phrase "ISO 11357-2 (1999) or national equivalents'' in the technical note to 1C008.

BIS notes that the amendments in 1C008 were agreed to by the Wassenaar Arrangement for consistency and to avoid differing treatment of resins having the same applications and functional capabilities. The plastic resins that are controlled under 1C008.a.4 are extremely similar to those controlled under 1C008.f. The characteristics of these two types of resins allow them to be used interchangeably for the same end-uses.

BIS adds that the resins under 1C008.a.4 are controlled differently than those under 1C008.f. This has created a marketing distortion which favors the resins controlled under 1C008.a.4. Therefore, the final rule clarifies the distinction in the control of these resins by including a glass transition temperature for items described in 1C008.f.

Amendments to Category 2- Materials Processing

BIS' final rule amends ECCN 2B001 by:

(a) Removing the Note to 2B001.a regarding the contact lens turning machines exception and placing it under the national security (NS) Reason for Control; and

(b) Revising Note 2 to 2B001.c regarding what jig grinders are not controlled by ECCN 2B001.

BIS explains that although the Wassenaar Arrangement agreed to not control under 2B001.c grinding machines that are "designed specifically as jig grinders that do not have a z-axis or w-axis, with a positioning accuracy with 'all compensations available' less (better) than 3 &956;m according to ISO 230/2 (1997) or national equivalents,'' Technical Note 6 at the beginning of Category 2 Product Group B states that "The positioning accuracy of 'numerically controlled' machine tools is to be determined and presented in accordance with ISO 230/2 (1988).'' Therefore, in Note 2 to 2B001.c BIS has replaced the "3 &956;m'' with "4 &956;m,'' which is the equivalent positioning accuracy under the 1988 standard.

BIS adds that the amendments to ECCN 2B001 were agreed to by the Wassenaar Arrangement because many of the latest generation jig grinders today utilize a Computer Numerical Controller (CNC) to control and coordinate 3 or more axes. The wording of the Note to 2B001.c could be interpreted to release 3- or more axes jig grinders with full CNC contouring control if a c- or an a-axis, as listed in 2B001.c Note 2, is added to their current capabilities. This was not the original intent of the Note. BIS states that the revisions presented in this final rule clarify that jig grinders with precise 3-dimensional contouring capability are controlled, because of their capacity to produce high-precision, complex military components. The revision limits the exclusion by placing accuracy parameters on the third linear axis (z or w).

According to BIS, ECCN 2B005 is amended by removing the term "stored program controlled'' from paragraphs 2B005.a, .b, .c, .d, .e, .f, and .g. ECCN 2B006 is amended by removing the term "stored program controlled'' from paragraph 2B006.a. This term is removed because most equipment is computer controlled now and the term no longer adds any value to the control.

BIS states that ECCN 2B201 is amended by revising the list of items controlled by redesignating paragraphs (a) and (b) as paragraphs (b) and (c) and adding a new paragraph (a) that describes machine tools with "positioning accuracies'' to mirror 1.B.2.a and the Note to 1.B.2.a from the Nuclear Suppliers Group INFCIRC/254/Rev. 5/Part 2 dated May 2003. This amendment is being added to conform with the Wassenaar Arrangement's exclusion note for turning machines specially designed for the production of contact lenses and capable of machining diameters greater than 35 mm in 2B001. Also, because of the structure of the numbering system for ECCNs in the CCL, an item (such as the item covered under ECCN 2B201) which is controlled for nuclear proliferation (NP) reasons but not NS reasons cannot remain in an NS-controlled ECCN where the second digit is a "0'' (2B001), because "0'' indicates that an item is controlled for NS reasons. The second digit differentiates individual CCL entries by identifying the type of controls associated with the items contained in the entry. (For example, zero indicates NS controls, one MT controls, two NP controls, etc.)

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.